Indonesian telco Indosat is launching a new adtech product this week at the Mobile World Congress event in Barcelona. It’s called Indonesia Mobile Exchange (IMX), a mobile-first real-time bidding (RTB) advertising exchange. Essentially, it’s a mobile auction block where digital ads for an Indonesian audience can be bought and sold.

The project is a joint venture between Indosat and Smaato, a global mobile RTB ad exchange. Indosat’s existing mobile advertising offering i-klan, which currently sits within the firm’s digital services unit, will become part of the joint venture.

IMX lets Indonesian and global advertisers connect with publishers in the archipelago and provides firms with targeted advertising to local consumers. Indonesia is one of the most promising digital advertising markets in the world in terms of the number of monthly impressions and growth potential, according to Indosat.

While Smaato claims its mobile exchange technology already delivers close to 5 billion impressions a month in Indonesia, IMX will further utilize Indosat’s customer base of 60 million mobile subscribers for more exposure.

“Indosat has been passionate about creating a strong digital services ecosystem in Indonesia for many years,” said Alexander Rusli, Indosat’s president director and CEO in a statement. “Mobile advertising, mobile commerce and mobile payments are all critical components of this ecosystem as they revolutionize the way companies interact with consumers. With the Smaato partnership we can help connect smart and meaningful advertising to Indonesian consumers at a scalable size and with faster speed.”

“Indonesia, with its large population and high advertising spend, is one of the most important markets for Smaato globally,” said Ragnar Kruse, Smaato’s founder and CEO.

IMX will be steered by Indosat’s digital services unit, which focuses on mobile commerce and mobile payment solutions, among other initiatives. Indosat hopes to help build one of the world’s largest digital ecosystems in Indonesia. The firm has its work cut out for itself, however, as it must compete with the likes of Adskom and Adplus, which are also aggressive adtech companies in Indonesia with similar offerings.

Tumiwa confirmed to Tech in Asia that he would take the reigns of OLX Indonesia in late April, but did not mention any further details. When Tumiwa becomes CEO, he will help facilitate the company’s internal transformation following the January merger. In general, Tumiwa says he will focus on encouraging more Indonesians to embrace the opportunity to sell things they no longer need, which is part of OLX Indonesia’s mission.

“I will leave Garuda. Now their digital business is much stronger, both on their website and application,” Tumiwa told CNN Indonesia. Before joining Garuda, Tumiwa served as country manager for Multiply Indonesia, an ecommerce startup that shut down in May 2013.

Tumiwa continues to serve as chairman for the Indonesian Ecommerce Association (iDEA), which is a communication forum for industry players to interact with the Indonesian government, among other purposes. idEA consists of 10 large local ecommerce companies, including BliBli, Kaskus, and Tokopedia.

]]>https://www.techinasia.com/leaving-garuda-indonesia-daniel-tumiwa-head-olx/feed/0Four prominent VCs talk fundraising and scaling at Tech in Asia Tour Jakartahttps://www.techinasia.com/prominent-vcs-talk-fundraising-scaling-tech-asia-tour-jakarta/
https://www.techinasia.com/prominent-vcs-talk-fundraising-scaling-tech-asia-tour-jakarta/#commentsTue, 03 Mar 2015 05:00:42 +0000https://www.techinasia.com/?p=221439 The Tech in Asia Tour made its first stop in Indonesia’s capital at Jakarta Digital Valley on March 2. While five startups waited for their chance to get on stage, TIA’s Leighton Cosseboom led a discussion with the four seasoned VCs who also acted as judges in the pitch competition later that evening.

Young entrepreneurs often share the same problem. I have an idea, maybe a prototype, but lack an understanding of how to move on from there. How do I raise funds for my idea? How do I scale?

Know the profiles and preferences of potential VCs

Every VC firm has its own strategic approach, determined by the size of the fund, experience of the VCs, location, and other factors. Knowing as much as possible about the VC that a startup plans to approach will help get a foot in the door.

According to Stefan Jung, Monk’s Hill is mostly interested in Series A or B investments between US$2 to 5 million. Andi S. Boediman’s Ideosource has a different approach: “We do seed capital below US$500,000, but we also go big, above US$ 5 million.” Knowing what stage and how much a VC is likely to support your startup is a good guideline to help decide who to approach.

Relationships and perseverance matter – a lot

The worst thing a founder can do is crash doors with demands before tactfully building a relationship first. Kuan Hsu was once approached cold with an email, but when he agreed to meet, the founder requested he sign a non-disclosure agreement before he had the chance to learn more. “That did not work for me”, said Kuan Hsu, laughing. “We suggest you to establish a relationship with us before you ask for investment. This allows me to collect data points.”

VCs usually agree that ideas are easy to come by, but that it’s the execution of these ideas that matter. Boediman put it bluntly: “I don’t believe in ideas. I can give you a hundred of those. I am not interested if you have not already built something that gives value to people.”

Jung points out that a connection between the person and the idea helps a lot, as this will give them the strength to persevere if things get rough. “If people are doing it for an opportunistic reason, they will give up early,” he observes. Kuan adds, “I also don’t care so much about product. If a team is good, it will realize when a pivot is needed and it will be able to adjust.

VCs can help startups scale, but a good understanding of the market is key

While starting up a business is comparatively easy, the real challenge begins when the time comes to scale up. But this is where a good investor on board can help.

“Bukalapak, one of our investments, is a good example,” says Kuan. “Their product is a B2C (business to consumer) marketplace. They worked in a niche, trading bicycle parts. We helped Bukalapak identify their sales funnel, to analyze their customer’s behaviour in a systematic way. As a consumer facing company you need to be on top of your metrics at all times. We helped them understand how to maximize each step.”

While metrics matter, Jung points out that scaling is also about recruiting the right people. Beyond that, to scale effectively a startup needs experience and tools, which is how great investors can add value to a startup. “We’ve seen many business models, so we can see patterns, and we can give strategic advice. We also help set up KPI sheets and how to solve leadership issues,” says Jung.

Boediman says that founders need to be clear about the potential to scale to begin with. “We look at companies this way: Is there a 100 million dollar potential? If there is not, why even start?”

While there surely are smaller markets to explore and build sustainable businesses around, Boediman’s message is clear: A startup must do its homework to understand its market and potential to scale, all arguments which will help to approach and convince the right VCs.

How to get to this understanding? Come to events, talk to people, and read. Boediman has a tip for young startups: “Read Zero to One. Please read that book.”

In the lead up to Tech in Asia Singapore on May 6 and 7, we hold Tech in Asia Tour, a ten-city tour around Asia to find the best startups to showcase. This evening, Tech in Asia Tour stopped in its first city: Jakarta.

During the event, five finalists selected from around 50 participants were given a chance to pitch in front of a panel of judges. The judges who assessed each startup and ultimately chose a winner were Stefan Jung, partner at Monk’s Hill Ventures; Andi S. Boediman, managing partner at Ideosource; Kuan Shu, principal at GREE Ventures Asia; and Kay-Mok Ku, partner at Gobi Partners.

Vurnisio is a platform where people can find home design and decoration inspiration, find local design talents, and buy decoration stuff for their house. Still in beta phase, Vurnisio also has a mobile app.

Razelab developes a mobile application named Light Me Up which has same function as a glow stick or bracelet. Instead of bringing conventional glow sticks to concert, people can use this app to put on a colorful light show. The smart app will recognize the sound produced by the concert’s speaker system to change the light color.

World Marinas is a marina database mobile application for sailors and yacht owners. It helps users locate and look up information about nearby marinas. World Marinas now covers the Caribbean, the Mediterranean, and South East Asia. It is available for iOS.

This startup provides a cloud-based automatic meter reading system for companies to monitor the use of their electricity, gas, and water supply. It helps companies predict monthly billing and project their companies’ energy usage and analysis.

Blackbird Messaging is a local Indonesian chat app. Unlike other chat apps, it allows unlimited users in its chat group. It also provides an API for developers. Blackbird Messaging is still in the development phase and was launched today. It is now available for Android.

After pitching their products to impress judges and audiences, the winner of Tech in Asia Tour Jakarta goes to … drum roll … Razelab.

Razelab won free flights and accommodation in Singapore, conference passes, and a startup booth at Tech in Asia Singapore 2015. Huge congratulations and see you at Tech in Asia Singapore 2015!

For those who still haven’t gotten their tickets to Tech in Asia Singapore, you can get 15 percent off through 22 March with the code tiasg15. For more information on the event, please visit the official website. You can also check the other cities we’re visiting on the Tech in Asia Tour schedule here.

An Indonesian startup called Jurnal, which is a cloud-based accounting software for small- to medium-sized businesses, announced today that it received seed funding of an undisclosed amount from local venture capital firm East Ventures. Jurnal plans to use the fresh funds to grow the team and invest heavily in further product development (Disclosure: East Ventures also invests in Tech in Asia. See our ethics page).

Co-founder Daniel Witono says his software simplifies and expedites the bookkeeping process. It’s also capable of generating reports instantly, something that not many competing products are able to do. “We are awesome because we serve two parties, the businesses and the accountants,” explains Witono. “[We provide] easy collaboration between accountants and business owners through a shared ledger. This saves time and eliminates redundant entries.”

Witono’s background is in computer engineering, and he previously worked at Microsoft and local epayments company Veritrans. His fellow co-founder Anthony Kosasih has similar expertise, although he also has extensive accounting experience. When Kosasih was still in school, he ran his own small business and says he wasted a lot of time on bookkeeping. As the existing solutions were costly and inconvenient, this was a problem he also noticed in several other business sectors.

“With its technology, Jurnal will help and accelerate Indonesian SMBs to a new level of efficiency. Daniel and Anthony have shown a strong passion and commitment to make it happen,” says Willson Cuaca, managing partner of East Ventures.

Jurnal’s beta site launched in January, and since then it has been serving 20 different businesses including local traders, importers, restaurants, and online stores. The site has around 100 registered users, and Witono says Jurnal measures user activity based on the number of actions “logged within a specific period of time.” According to Witono, the site also competes with similar products made by CPSSoft. But Witono says Jurnal is different, as the other products are desktop-based and require high initial investment.

Currently, Jurnal is free to use. In the future, the startup plans to incorporate a subscription business model with prices starting at Rp 150,000 (US$11.50) per month. According to the co-founders, Jurnal has the edge over other accounting software brands in Indonesia, as they tend to charge high upfront costs along with ongoing maintenance fees. The co-founders project that the startup will attract more than 5,000 business owners by the end of this year.

“Owners always need to know the current snapshot of their business to make intelligent decisions,” explains Kosasih. “But most owners do not have the capability or time to prepare the reports […] Affordable, outsourced accountants with the correct tools can help them get it.”

Before I lay out the seven building blocks that we need to foster the Indonesia startup ecosystem, let me explain where Indonesia’s tech industry stands at the moment relative to its neighbors.

Late last year, I was invited to South Korea as part of Dreamplus Alliance. Initiated by the Korean Hanwha Group, this is an alliance between 11 accelerators from different countries in Asia to promote startup ecosystems. The idea is to form a global alliance of key regional accelerators and to assist promising startups to reach their dreams on the global stage. After learning the maturity of each ecosystem, I see the difference between each country’s technology ecosystem and market maturity.

2. Advanced technology nation with limited market

Japan, South Korea, and Taiwan are advanced technology countries with mature markets, but each has limited size. They have the technology that we need – and they need the Indonesian market to expand. They are Indonesia’s natural partners; we can obtain technology leadership from these countries and localize the tech for Indonesia. Some big companies will get into Indonesia by themselves. A good model is to license the IP, know-how, and technology. The best model is doing a win-win partnership through a joint venture in which each party will contribute value.

3. Advanced technology nation with small market

Singapore is a country with very advanced technology but no market, so Singaporean firms have to think globally from day one. Most of the Singaporean technology startups will face a big challenge when entering Indonesia since there’s a huge gap between the technology and market readiness. Singapore’s government has been a very strong proponent for the startup ecosystem, from providing the conducive environment and various funding schemes, all the way to providing access to the US market by opening an office in US. This makes Singapore aspire to become the regional/global access and startup funding hub in the region, but not for a real, scalable market.

4. Emerging technology nation with limited market

Thailand and the Philippines are quite similar to Indonesia. Vietnam is slightly behind Indonesia while Malaysia is slightly ahead of Indonesia in terms of technology and market maturity. Any technology and solution that is successful in each country can be replicated to another country. This has been a model for some regional players, including online retail logistics startup aCommerce (which is invested by Ideosource). Then, the collaboration between Indonesia and these other emerging technology countries is about opening the other market for the startup companies to consolidate and become regional players.

5. Indonesia is the emerging technology nation with vast market

Indonesia has a vast market, so local startups can sustain and scale by only targeting the home market. With 250 million people, Indonesia is projected to become the third most populous country behind India and China within the next 20 years. Indonesia’s per capita GDP is US$3,500 – which sits between India and China’s – but it is growing at double the rate within the past five years. The new Indonesia government is targeting to increase GDP five to seven percent by inviting foreign investment for infrastructure and new industries.

I believe that Indonesia is the next startup nation if we are able to cement all the building blocks in the industry. Let’s take a closer look at Indonesia’s current state and how we can contribute to making it happen.

Building block 1: Entrepreneurs, diaspora, and immigrants

The first generation of internet entrepreneurs in Indonesia is mostly successful because of their skills and persistence. The second generation of internet entrepreneurs is mostly coming back from studying and working in high-tech companies abroad. The third category comes from previous executives working in global/multinational web companies in the region or in Indonesia. They have a multi-ethnic background and many of them have an investment banking/management consulting experience.

Proliferation of ideas and knowledge comes from the diaspora and interconnectedness of people. Many of the brightest minds are educated at Western universities and are working in global/multinational companies. When they quit their jobs and return home, they take both knowledge and contacts. They start new companies and create an interconnected network that is closely related. Global accelerators and venture capitals have identified this and they are actively investing into these founders.

Bringing the diaspora back and encouraging them to start companies in Indonesia will inspire knowledge and technology transfer.

With the Indonesian digital industry growth, there is a big need to capture the best talent not only from Indonesia, but from other countries as well. By attracting exceptionally skilled immigrants, they can bring new knowledge and create jobs within the local economy. It’s new businesses that are going to create new jobs, and there are certain policies that need to be in place for that to occur. William Tanuwijaya from Tokopedia plans to hire a lot of engineers in India, Vietnam, and China to keep up with the estore’s growth and to get a faster knowledge transfer from global talent.

Across many developed countries, there is interest in attracting exceptionally skilled immigrants who can bring new knowledge and create jobs within the local economy. Graphic by Migreat. From the startup visa Wikipedia page.

In order to grow Indonesia as an innovative and entrepreneurial nation, policymakers need to take steps to attract more highly-skilled entrepreneurial foreigners and global talent to Indonesia.

This is not about opening the Indonesian market for global players, but inviting entrepreneurs to use Indonesia as a base to serve the global market.

Bali is a new, fast-growing startup scene that people are surprised by. If the entire country can embrace international talent in the way Bali is doing, we might be able to repeat the story of Walter Spies, Antonio Blanco, and John Hardy in the art world. The fastest way to capture the international market is inviting those who understand that market themselves. Bandung and Yogyakarta have been homes to various developer communities, and naturally some international companies have established a production team in these cities. This will encourage greater transfer of knowledge to Indonesian talent.

Building block 2: International education and vocational training

It is estimated that 2.6 million Indonesians will enter higher education in the next decade due to Indonesia’s economic growth, political stability, demographic changes, and rising education levels. But there are only 36,000 students currently studying abroad – that’s only one percent of Indonesia’s total student base. The need for internationalization is essential so a greater number of Indonesians are equipped with wider perspectives and a global mindset. Australia and the US are the most popular study destinations for Indonesians. China, Malaysia, Singapore, Germany, and Japan are some of the other popular destinations. But the real contribution to the Indonesian economy will happen when we can invite the best talent back to Indonesia.

There is a precedent. China’s government runs a “Thousand Foreign Experts” program which is designed to attract foreign academics and entrepreneurs over the next 10 years to help improve research and innovation. Under the program, successful candidates will receive a subsidy and research allowance. This program is already proving to bring the best talent back to China.

Meanwhile in Indonesia, the total number of international students studying in the archipelago is only about 3,000. Internationalization of higher learning in Indonesia would result in the increase in flow of ideas, attitudes, values, technology, the economy, and people across borders – all necessary responses to the impact of globalization. The fastest way to attract international students and bringing this standard into higher education is by partnering with established universities in Australia and the US, as done by Singapore, Malaysia, and many other countries.

Now it is the right time for the internationalization of higher education, research, and innovation in Indonesia.

The Indonesian labor market is characterized by a high level of youth unemployment since the nation’s vocational education and training doesn’t match the requirements of the workplace. An interesting idea put forward by Andrias Ekoyuono, VP for business development at Ideosource, is that with the extensive workforce, Indonesia can become the next BPO (business process outsourcing) and KPO (knowledge process outsourcing) service provider, alongside India and the Philippines. Typical outsourced work includes data entry, medical transcription, content writing, software programming, or HR and financial services. KPO focuses on knowledge and information related activities that include legal services, intellectual property and patent related services, engineering related services, web development, CAD/CAM applications, business research and analytics, legal research, clinical research, publishing, and market research.

To help achieve this, the government should commit to skilled and vocational education. Credits from community colleges should be transferable to a university, thus offering graduates opportunities to further their vocational training at a higher level.

Indonesia should export its skilled workforce for the global market by focusing on technical and vocational education.

Building block 3: Funding the startup ecosystem

Startup by their very nature have a very high mortality rate – they’re still exploring their offerings and business model. Most startups fail. That’s why grants and Corporate Social Responsibility (CSR) money are the best models at the incubation stage. The cost of delivering the investment, incubating the company, and exploring avenues to initial traction is higher than the potential return on investment. Incubation programs are risky and mostly won’t provide a good return on investment (ROI) from the program, so CSR funding from various state-owned or public companies is the best to be used as an incubation program.

Venture capital investing by nature is also a risky investment. The higher the risk, the better the return. Some of the risks include a high failure rate because of entrepreneurs’ lack of experience, getting into a market that is too early, creating an offering that doesn’t scale, and a very limited exit for the investment. We have seen this in the early dot-com bubble in the early 2000s.

The partnership between the government and private venture capital firms has been implemented by a number of countries, such as Singapore and Taiwan. Indonesia’s tech minister, Rudiantara, follows this model and aims to raise about US$1 billion to help develop Indonesia’s digital startups. That money will come from the private sector. It sounds good that the government is trying to support the tech industry, but do we need the government’s involvement?

It raises many questions, too. Who will be responsible if the investment goes wrong? Will the appointed VC be blamed if they lose the investment amount? Will this be a subject to a KPK (Corruption Eradication Commission) investigation? If there’s so much money from the government, isn’t there a sudden spike in opportunistic institutions competing for this funding without a prior track record?

What we need the most is a more open investment policy, not the funding itself.

The US$100 million investment in Tokopedia in October last year was major news. It creates a positive investment environment in Indonesia. Looking into the market growth and investment momentum, we’re going to see a billion-dollar investment within three years. Foreign direct investment from Korean and Japanese investors has been here in Indonesia as early as 2011. Recent investment is done by Chinese giants as well. Global players like Rocket Internet and Naspers have been actively investing from 2012. Funds dedicated to Southeast Asia are focused on Singapore and Indonesia as major investment targets. There’s enough funding for the tech industry and the trend is growing at a rapid pace even without government support.

Indonesia’s conglomerates has been investing in the digital space too. Djarum has done so through GDP Ventures and the Merah Putih Incubator; Kompas Gramedia through direct investment and Skystar Capital; Bakrie through direct investment and venture capital; Salim partnering with Rocket Internet through PLDT; Sinar Mas through its own venture capital and Ardent; Emtek mostly through direct investment; Lippo through its venture capital and direct investment. Plus Ciputra Group provides entrepreneur support through the GEPI program. Most Indonesian telco companies have also committed sizable investments in the digital space.

With support from local investors, Ideosource believes in investing in the best internet companies and the brightest founders. We have invested in many Indonesian companies, including Touchten, Saqina, Orori, and Female Daily.

Besides ecommerce and digital media, Ideosource is committed to invest in disruptive and innovative startups like fintech and internet of things.

Building block 4: Business permits and regulations

Indonesia is infamous for its unfriendly bureaucracy for processing a business permit and unwelcoming regulations for foreign direct investment. The President has promised that this will become a thing of the past and has launched a one-stop service for navigating foreign direct investment. But Indonesia still needs to improve a lot when it comes to the ease of doing business.

But the President and members of the executive team seem prone to getting into controversies. Indonesian media recently reported the government would protect local online businesses from overseas acquisitions, which turned out to be untrue. I would highly recommend the government to work on good PR in helping their communication strategy and getting across a consistent message to avoid confusion among business stakeholders.

When it comes to startups, we need a change in the existing regulations when accepting foreign direct investment. The regulations needs to open if we want to foster a culture of innovation. To encourage an investment-friendly environment and regulations, my partner at Ideosource, Edward Ismawan Chamdani, indicated that the government needs to provide incentives for investors, such as capital gains tax waivers, friendlier laws to allow different classes of shares to protect investors, and other financial/taxation/legal programs to incentivize investors to set up their funds and investments in Indonesia instead of offshore.

Plus, there are some controversies with regard a regulation in the ecommerce space in the form of the “negative investment list.” This list specifies sectors of the Indonesian economy in which foreign investment is prohibited or limited. Currently the Indonesian government has closed foreign investment in businesses selling directly to the consumers. William Tanuwijaya, Tokopedia’s CEO, expects that the government would create a conducive ecosystem rather than focusing on pitching local versus foreign investors.

Building block 5: Digital and physical infrastructure

Indonesia’s broadband business is doubling in market value due to high internet adoption. However, internet penetration remains sluggish, with only 20 percent of the population online, compare to 40 percent in Thailand and 90 percent in Singapore. This is the biggest bit of homework for the government if they are serious about building the web and tech ecosystem. Indonesia spent one percent of its GDP on infrastructure in 2009, compared with greater amounts by its Asian neighbors China (8 percent), South Korea (2.5 percent) and between 3-6 percent for countries such as Singapore and Malaysia.

Indonesia’s President pitched to global leaders at the APEC Summit on investing in Indonesia. On the agenda was the sea toll road, a program to modernize 13 major ports that may reduce the country’s logistics costs by 10 to 15 percent. Presently, between 18 and 22 percent of companies’ production costs in Indonesia are absorbed by logistics, particularly due to expensive transportation costs between the archipelago’s islands. Across the region, this figure is below 10 percent. Between 2014 and 2017, there will be an additional eight seaports, two airports, eight railways, five power plants and 11 water supply and waste treatment plants. By building these infrastructure projects, Indonesia will surely enhance its access and distribution.

The thriving smartphone sector in Indonesia opens up a door for mobile as an alternative banking infrastructure able to offer accessible, simple, and affordable financial services even in remote areas. But mobile telcos are not proven to provide financial services as they have a historical precedent in abusing their mobile content charging. And since these companies don’t have ATMs, the e-wallet solution offered by the telcos is not easy to be cashed-in.

Out of many solutions offered in Indonesia, Mandiri E-cash stands out as the most disruptive solution for digital money. It is a debit system linked to mobile phone numbers rather than bank accounts. Users deposit funds at e-cash agents, usually shops or kiosks, or by transferring from existing bank accounts. The funds can then be drawn upon for transfers and payments, after mobile phone authentication. Even without the need to open an account in the bank, you are able to withdraw cash from a Mandiri ATM.

Large-scale adoption is still the biggest challenge for e-money. The key driver for e-money adoption comes from an unexpected source – the Indonesian government. After stopping the soaring burden of fuel subsidies, the government is giving a direct cash subsidy to underprivileged people. It’s called BLNT (direct non cash subsidy). BLNT is distributed through electronic money as an effort to reduce the cost of distribution, avoid potential losses, and educate citizens about the use of electronic money. Targeting 15 million underprivileged people by the end of 2015, Indonesia will become the second biggest mobile money user base in the world after Kenya. With wider adoption of digital money, it gives people an immediate benefit to connect this solution with other digital payment ecosystems including remittances, ecommerce, and many others.

We can mark this as Indonesia’s dawn as a cashless society.

Building block 7: Indonesian nationalism

Peng T. Ong, the managing director of Monk’s Hill Venture and co-founder of Match.com, mentioned in an inspiring discussion the spirit of nationalism growing in Indonesia. We see the spirit of nationalism in that we care about ourselves, our future, and our nation. We see a new generation of leaders emerge, making people believe again in the government and how it can bring the best for the people and the nation. When everyone believes in one thing, great things happen.

We will see Indonesia thrive and become a great nation. A new startup nation.

2014 was probably the most eventful year for Asia’s startups yet, at least in terms of funding. Japan, and Softbank in particular, has invested massively outside of the domestic market. The US is putting serious money into India. We also saw massive funding rounds for Lazada (US$1.2 billion in valuation, with an estimated gross merchandize volume of US$270 million, posits Rebright’s founding partner Takeshi Ebihara), Tokopedia, SingPost, and GrabTaxi.

“We haven’t seen this kind of fundraising until 2014. It’s phenomenal progress,” says Ebihara in a panel discussion at the Asia Leader’s Summit, an exclusive conference for investors and startups. It’ll probably get crazier this year: just a few days ago Indonesian conglomerate Lippo Group announced it will pour US$500 million into its own massive ecommerce venture. Signs of a massive bubble beginning to pop? We’ll see.

These investments underscore a reality for startups and investors in Asia: partnerships play an outsized role for regional expansion. China and Japan aside (these are relatively homogenous markets), the rest of Asia consist of countries with different infrastructural problems and consumer behaviors, even within borders. Intuitively, companies already know this. Ebihara highlights the cross-border nature of these investments: China’s Alibaba invested in Singapore’s SingPost, Japan’s Softbank invested everywhere, and Singapore’s Temasek backed Indonesia’s Tokopedia.

For the tech industry here, mastering the art of the partnership will likely make or break a company’s ambitions.

Conventional wisdom says that strategic investors, in other words the big corporations, are usually the last resort for startups when it comes to fundraising. By and large, the panel agrees.

According to Khailee Ng, strategic investors sometimes drag their feet when dealmaking. “Founders can get distracted by hope and big promises. But the deal can get cut off, or the board doesn’t approve of it. It actually happens very often,” he adds. But while a bad strategic investor can make a startup less investible, he cites some good examples, including Thai ebook startup Ookbee and its investor Transcosmos.

When evaluating a partnership, it makes sense to look at several indicators. Speed of dealmaking is one. Strategic alignment is another – the goals of both parties must match. In ventures involving unproven business models, the mentalities of both partners matter too.

Mario Suntanu recalls ecommerce giant eBay’s endeavors into Indonesia as a demonstration of partnerships that failed to reach their full potential. It entered the country in 2013 through joint ventures with Telkom Indonesia, the largest telco in the country.

“The local partners weren’t strong in what they wanted to do anyway. The execution capability was lacking. You can build a team with high cost, but lack the agility and drive to navigate on an unproven model,” he says. “A bureaucratic partner with another bureaucrat won’t work. You need a corporation driven by a founder working with a founder-driven startup.”

Ng chimes in: “That’s why it makes sense to acquire startups.”

Kay-Mok Ku points out another factor to look out for when evaluating partnerships: each party should bring something different and complementary to the table. The Garena-Tencent partnership was like that. Garena, a games distributor in Southeast Asia, knew how to get games into the hands of gamers. Tencent, meanwhile, had the money and the League of Legends license that made Garena the dominant publisher in the region.

Partnerships come in all flavors

The discussion turns towards the mechanics of partnerships. Ebihara says that partnerships come in many forms: minority stake investments, mergers and acquisitions, joint ventures, and more. How can you pick the right form of partnerships?

Ku notes that while Chinese and Japanese companies may do well in their homogenous domestic markets, they would struggle if they go solo when expanding to Southeast Asia due to distribution challenges. He advocates that more companies should take up the Tencent-Garena model of finding distributors in each of the Southeast Asian markets.

Ng says that the strategic intent of the foreign company should be a core consideration. Is it looking to bolster existing revenues or find new income streams as its business erodes? Or does it just want to do market research?

Consider a firm with a low-risk character and wants to learn as much about new markets and verticals. Fund of funds investing would allow it to spread risk and learn a bit about what it’s getting into. It can then decide if it wants to commit more and put its reputation on the line through starting a new venture.

Often the decision making won’t involve picking one partnership approach and sticking to it. Amit Anand advocates trying everything. “Having just one strategy isn’t going to be enough. Invest in a few funds to look at what innovation is happening at the grassroots level. Create distribution partnerships. Keep an eye open for great teams you want to acquire. I would advice somebody to do everything,” he says.

Ng agrees, adding that SingTel Innov8, the venture capital arm of Singapore’s largest telco, has benefited from such an approach.

He also points out that 500 Startups operates in such a way that it caters to investors with lower risk appetites. It runs different funds catering to different markets, such as 500 Durians for Southeast Asia, 500 Kimchi for Korea, and the rumored 500 TukTuks for Thailand, which he could neither confirm nor deny. It invests in a wide spread of companies that meets its investment thesis.

“We’re more like an index fund. Our money is widely distributed, catering to investors who want distributed risk. We launched various funds catering to specific needs of limited partners.”

Hidden dynamics

While joint ventures often make sense when entering new markets, exceptions exist. Suntanu says chat app Line has managed to win markets like Taiwan and Thailand by setting up subsidiaries in those countries. Of course, Line relied on partners for its ecommerce initiatives, but it retained control and ownership of the product, which is difficult with joint ventures.

“Joint ventures are the hardest. If your partner is located in another country, you’ll barely see them and won’t really know what’s happening on the ground. Are you going to risk your brand doing something like that? Even if you find a good partner, stay away from 50-50 arrangements. Someone needs to call the shots and take responsibility,” says Suntanu.

For some firms, partnerships are a matter of life or death, especially if the they’re in sunset industries. Yet public-listed firms face huge challenges in facing down profit-seeking shareholders or departments while they bet on the future, says Ku. This is especially true of industries (like print media) where the shift to digital is glacial.

He adds: “For media companies who invest in digital, they don’t get the money back since online advertising revenue hasn’t caught up. It’s hard to create new businesses if the firm is all about profits and losses. The sales guys still wants to sell TV ads. Who would want to sell online ads?”

Given recent developments in the tech scene, the VC-startup dynamic is the most interesting of all. Supply of venture capital money is increasing at a faster clip than the number of quality startups, driving up valuations. Venture capitalists now need to work harder to differentiate themselves from competitors.

For Anand, a good portfolio is the best sales tactic to attract startups to him. “You have to hack yourself into the first few good deals, and the rest will follow,” he says.

Ng offers another approach. Since venture capitalists hunt in packs, you need to ingratiate yourself with the pack you want to associate with.

“Build a value proposition for the core investors. Koichi Saito of IMJ Investment Partners is a good example. He’s a hardworking son of a bitch. He’s a honey badger that gets shit done. That makes me want to work with him more,” says Ng.

]]>https://www.techinasia.com/partnerships-break-asias-startup-scene/feed/0New makerspaces in Jakarta that will accelerate innovationhttps://www.techinasia.com/makerspaces-jakarta-accelerate-innovation/
https://www.techinasia.com/makerspaces-jakarta-accelerate-innovation/#commentsFri, 27 Feb 2015 11:00:19 +0000https://www.techinasia.com/?p=221116The maker movement in Indonesia is gaining speed. At Social Media Week Jakarta, managers of makerspaces congregated to proclaim the dawn of a closer-knit and more productive Indonesian innovation ecosystem.

Makerspaces are similar to co-working spaces, with the difference of added sweat and dirt. The type of work that gets done in makerspaces often involves taking things apart, soldering, drilling, laser cutting, and 3D printing, or even working with chemicals and biological substances.

The key is rapid prototyping: With access to cutting-edge tools and interdisciplinary support and collaboration, innovators are able to speed up their innovation cycle, and move swiftly from idea to product.

Indonesia, somewhat left behind in the maker movement and hardware innovation game, seems to be slowly catching up, as new spots have sprung up over the past months and years. Here are some makerspaces in Jakarta:

Android app store Oomph, which is like a Google Play alternative for Indonesia, announced today that it has secured a round of seed funding of an undisclosed amount. The startup says it will use the funds to strengthen the team and expedite growth.

Oomph is aimed at the growing number of Android smartphone users in Indonesia. It has apps, games, wallpaper, music, and more. Users can pay for their downloads via prepaid mobile credit, commonly referred to as “pulsa” in Indonesian. That’s something Google Play doesn’t offer in Indonesia. Oomph is also more localized than Google Play with its language and content.

In October, Oomph’s co-founder and director Stanley Tan told Tech in Asia that the store had 4.5 million users in Indonesia. Today, Yasuhiro Seo, general manager for IMJ Investment Partners says Oomph now has 6 million users.

Seo did not comment on user activity, but Oomph’s daily user activity rate was around five percent in October, according to Tan. 48 percent of registered users were active monthly, and 78 percent were active quarterly. He also mentioned Oomph was getting more than 10,000 new users per day, and believes his product is on track to reach 10 million users by the end of this year.

“Now it’s in the stage to push up the existing good retention rate […] by implementing a variety of plans and features,” says Seo. “One of Oomph’s plans is also to push up the quality of its content. […] With our extensive network and portfolios, IMJ will help Oomph to connect with various content owners.” He adds that his firm will also help Oomph gather more hot content from outside Indonesia.

Oomph competes with some other alternative app stores in Indonesia, like Baidu’s MoboMarket and XL Axiata’s Gudang App.

Seo says that IMJ Investment Partners has been particularly impressed by the experience of Oomph’s co-founders. Tan says they’ve been in the mobile content business for 17 years – 11 of which have been spent in Indonesia, which makes them seasoned veterans in Jakarta.

(Update 3/2/15: Local telco Indosat has actually been running carrier billing since December. The line about users not being able to pay for Google Play with prepaid mobile credit is now out of date.)

If you’re interested in getting your startup funded and expanding your business, you may already be aware of our ten-city Tech in Asia Tour, in which we’re running around the continent, hunting for the best startups to join our free Singapore Bootstrap Alley.

If you live in Jakarta, next Monday is not to be missed. During the event, five selected startups will get a chance to pitch in front of a panel of judges. We’ve also invited a bunch of investors to give attendees tips and valuable insights. Of course, networking opportunities also abound. If you’re keen to get yourself connected and educated, here’s an overview of the event and three things that you can take away from our Tech in Asia Tour 2015:

1. Know how to find funding and develop your business in Asia

To give you a better understanding about how to grab much-needed capital for your tech business and how to help it grow, we’ve put together an awesome guest list of investors who are active both in and outside of Indonesia. Stefan Jung from Monk’s Hill Ventures will make an appearance, Ideosource’s Andi S. Boediman will be on the prowl, Kuan Hsu of GREE Ventures Asia is set to post up, and Kay-Mok Ku of Gobi Partners will also crash the party. The four VCs will share tips in a panel discussion called How to Fundraise and Scale in Asia.

2. Learn how to pitch like a pro

Knowing how to pitch your company to investors is one of the most valuable things a local startup can have in its repertoire. In our Pitch Day session, you’ll get a chance to watch five companies give back-to-back pitch presentations they’ve been working on to the investors. The judges will give feedback to the entrepreneurs and dole out constructive criticism on how they can refine their pitches. The panel will select one winner that will go on to our main Tech in Asia Singapore 2015 conference. This session is important to watch because it will also give entrepreneurs a feel of how to respond to questions from investors.

3. Network until the cows come home

In addition to hearing insights given to the pitching startups, you’ll also get a chance to talk to the investors and startups yourself. Be sure to come prepared with your business cards, as the connections you make at the event will likely be valuable in the future.

About the panel and speakers:

Stefan Jung (Partner, Monk’s Hill Ventures )

Stefan has set up several ecommerce companies in Southeast Asia, including Rocket Internet’s Zalora and Lazada, which together have raised over US$5 billion. Prior to that, Stefan was a strategy consultant at BCG and Bain, where he specialized in private equity investments. He has degrees from Copenhagen Business School, University of North Carolina at Chapel Hill, and Tsinghua University in Beijing. He also holds an MBA from London Business School.

Andi S. Boediman (Managing Partner, Ideosource )

Andi is the managing partner at one of Indonesia’s well-known VC firms, Ideosource. The firm invests in startups in the content services, media, ecommerce, and cloud computing sectors. Ideosource is looking for innovative startups and internet entrepreneurs who can make companies that grow rapidly. Some of Ideosource’s portfolios include Touchten Games, Saqina, Gimmieworld, and aCommerce.

Kuan Hsu (Principal, GREE Ventures Asia)

Kuan started out as a consultant for McKinsey and Co. After that, he managed supply chain technology for the Solectron Corporation. Kuan joined the Japan arm of GREE Ventures in 2012. Later, he moved to Singapore in order to get a bird’s-eye view of the Southeast Asian market. Kuan holds an MBA from the Wharton School of the University of Pennsylvania, and for a time, he also worked in investment banking for Goldman Sachs.

Kay-Mok Ku (Partner, Gobi Partners)

Kay-Mok Ku joined Gobi Partners in 2010. Prior to that he served as VP of business development at Xinya Media and MediaCorp in Singapore. He lived in Silicon Valley for more than 10 years, where he founded a company called Private Express, an applications service provider that is now a part of Salesforce’s AppExchange. He earned a computer science degree from UC Berkeley and an MBA from San Jose State University.

]]>https://www.techinasia.com/indonesia-bootstrap-alley-tour-jakarta-2015/feed/05 things we learned from Scott Lamb about how BuzzFeed workshttps://www.techinasia.com/5-things-we-learned-about-how-buzzfeed-works/
https://www.techinasia.com/5-things-we-learned-about-how-buzzfeed-works/#commentsThu, 26 Feb 2015 09:20:23 +0000https://www.techinasia.com/?p=220895BuzzFeed, the US media company valued at a whopping US$850 million just sent its first envoy to Indonesia. Scott Lamb, BuzzFeed’s VP for international, made an appearance today at Social Media Week Jakarta 2015 and also participated in a discussion at the @america venue at Pacific Place Mall.

BuzzFeed focuses on content created specifically to be shared on social media, and its team has built sophisticated mechanisms in order to become experts on what does well on these channels.

Here are some insights from Lamb into BuzzFeed’s operations that are useful not only to media startups, but to anyone who relies on social media as a marketing tool.

1. Mindset

Lamb points out that it’s important to think of content that does well on social media in a different way than you’ think about any other content. Unlike news or celebrities, highly sharable content is often something you would never search for – because you didn’t even know it existed. To illustrate his point, Lamb showed the image above, which received a lot of attention on BuzzFeed. Who would think of searching for a photo of running Basset Hounds?

Another way to think about content that people like to share is framing it as a gift, said Lamb. A beautiful set of scenic photos or even cute animals is something people want to send to brighten up each others’ days.

Content that includes aspects of identity also does well in the social sphere. To illustrate how identity factors in, Lamb showed a picture of a school classroom full of rows of identical seats created for right-handed people. This is content left-handed people can relate to in a special way. It’s likely to be shared by people who are friends with a left-handed person, or by left-handed people to their left-handed friends.

2. Find the right editors and then let them do their stuff. Humans are the best content filters

BuzzFeed has a very “hands-off” attitude towards its editors, Lamb explained. There are no lengthy editorial meetings where themes are defined or topics assigned. BuzzFeed taps into the personality and creativity of their editors and lets them find their particular voice.

There are also no fixed content resources the editors are requested to draw from. Lamb considers humans to be the best content filters and says BuzzFeed actually relies on the fact that its editors prefer different information resources, which helps keep their own content fresh.

3. Very scientific

BuzzFeed is very scientific about how it works with content. Lamb showed images of its highly specialized platform, built to work with social content, from which writers have access to a dashboard that shows the lifetime and performance of their posts. The publishing back-end also allows editors to do their own A/B testing, running various headlines against each other among random readers before making their final pick on the right headline.

While not every startup can replicate a custom approach like this and probably doesn’t need to, basic principles of a scientific approach to content should be considered. Which posts perform best and why? Which platform works best for you? Who is most likely to share? Lamb said BuzzFeed treats every post like a mini experiment. So should you.

4. Push the most successful stuff, let the rest go

While there still isn’t a formula to guarantee viral success, Lamb has one good piece of advice on this: look at the early performance of a post. If it has particularly high traction, single it out and push it as much as you can. This means other posts will get less attention, but that’s okay. One viral success is potentially worth more than many moderately successful ones.

5. Continue expanding to new but related ventures

BuzzFeed is applying what it has learned – and gained – from its core platform to new but related ventures. The team has launched BuzzFeed News, BuzzFeed Life and, most recently, BuzzFeed Motion Pictures. Lamb suggested thinking about dedicated content categories as a single network, integrated into the main site, to avoid creating content “silos”.

Ii Kurnia, head of communication for the Jakarta Provincial Government (left) with Alberto Ali, head of tech for Jakarta Smart City.

Jakarta is a megacity with a bad rep for underserving its inhabitants. Regular floods, fires, record-breaking traffic gridlocks, and pollution make life in Indonesia’s capital a daily stress test. But the tide is slowly turning as Jakarta’s government, now under the leadership of governor Basuki Tjahaja Purnama, is discovering how to make communication technology work in its favor.

Under the label “Smart City,” the government recently launched a program to apply technology solutions for more citizen participation, better citizen services, and more accountability and transparency in the local administration.

The product launched in December, and citizens can now visit the website to find information visualized on a map about traffic conditions, weather, threat alerts, and a variety of other notifications about the state of Jakarta. Using Google Maps’ API, the app pulls data from various sources including third-party and government resources.

The web app already has API integration with traffic-reporting site Waze and Twitter, but its most important partner is local player Qlue. Qlue is a mobile app through which people can create real-time reports that show up on the Smart City website.

Opportunities for entrepreneurs

At Social Media Week Jakarta 2015 (SMW), Ii Kurnia, head of public relations for the Jakarta Provincial Government – along with Alberto Ali, head of tech for Jakarta Smart City – gave a keynote presentation, updating the public about the state of Jakarta’s Smart City program.

Currently the app has 15,000 registered users, according to Ali, but he didn’t comment on how many of those were active. He adds that the website has only received 800,000 page views since its launch in mid-December. As Jakarta boasts a population of of more than 10 million, clearly there’s room for growth.

The government has already allocated Rp 3.5 billion (US$278,000) to the program and is ready to invest another Rp 30 Billion (US$2.4 million) in 2015. According to Ali, some 100 staff at the city council are already working with the app, processing reports, and analyzing crowdsourced data.

This commitment opens up interesting opportunities for startups with technologies and services that could be integrated into Smart City Jakarta. Ali says the city is open for collaboration and ready to talk to local startups.

(Update 2/26/15: This article has been updated to show that Ii Kurnia is in fact the head of communication for the Jakarta Provincial Government. Initially we named him as Cucu Ahmad Kurnia, which was an identity mistake on our part.)

]]>https://www.techinasia.com/jakarta-smart-city-social-media-week/feed/0One year on, Elevenia reveals how much of an impact it’s had on Indonesia’s ecommerce markethttps://www.techinasia.com/indonesia-ecommerce-elevenia-investment/
https://www.techinasia.com/indonesia-ecommerce-elevenia-investment/#commentsWed, 25 Feb 2015 11:45:46 +0000https://www.techinasia.com/?p=220733

James Lee, CEO of Elevenia.

Indonesian ecommerce site Elevenia is approaching its one-year aniversary next month, and that makes it a good time for an update on the telco-backed marketplace that has been going head-to-head with robust estore rivals like Tokopedia, BukaLapak, and Lazada Indonesia.

In the past, Elevenia – a joint venture between Indonesia’s XL Axiata and South Korea’s SK Planet – chose not to disclose the amount of capital that’s gone into the project. Today, however, we’ve got the numbers.

Elevenia currently has US$60 million in total investment, explains the firm’s CEO James Lee in an announcement. Lee adds that Elevenia’s initial investment was US$36.6 million, divided by the two telcos, and the rest of the cash was injected just last month. “The investment in January 2015 [was always] part of the initial plan,” adds Lee.

Over 800,000 shoppers so far

Lee says 60 percent of Elevenia’s total traffic and 30 percent of it total sales currently come from mobile devices in Indonesia.

At the moment, the site claims to be attracting more than 20 million visitors per month with 4.2 million of them being unique visitors. As of January, the company says it has more than 18,000 sellers and two million product listings. Elevenia also claims to have 800,000 registered members now, but did not put out any further information on user activity. To get a sense of scale for ecommerce traffic, Tokopedia disclosed in October that it receives about 10 million visitors per month and sold 24 million products in its fourth year of operations.

Lee avoids calling Elevenia a complete success after just one year of operations, but he remains optimistic about his company’s ability to stay competitive in the archipelago’s budding ecommerce scene. “Elevenia is fine. We’re still on the right track. And we’re ready to reach [our] 5X target from last year,” says the CEO.

While Elevenia is not the most well-known brand when it comes to ecommerce in Indonesia, it could perhaps be characterized as a quiet but formidable player – and aggressive too. Last March, the firm had a tussle with Tokopedia about an issue involving online merchants. In March, it will see yet another competitor in the form of MatahariMall.

A lot of entrepreneurs come into our office and ask for advice on how best to get their tech startup noticed in the Indonesian market. It’s true, the archipelago is somewhat of a difficult animal to cope with for newcomers. It’s tough to get recognition in Indonesia because there are many different types of consumers, all of whom engage with media in different ways. Religion and cultural values also come into play. Specifying “trendy women aged 18 to 25” as your target audience, for example, won’t be enough in Indonesia. You’ll need to think about a wide range of socioeconomic standings, a variety of education levels, prefered languages, and whether you’re marketing to Muslims.

It’s not an uncrackable case, though. Startups can market in Indonesia in many clever ways, and on the cheap. In no particular order, here are ten tips to help you promote your startup in the archipelago. They’re sure to come in handy regardless of whether you’re a homegrown tech startup or a foreign firm looking to enter Indonesia’s playground.

1. Spread your data around like hot butter

You may already be familiar with content marketing. This is actually an effective strategy in most places, but it’s particularly useful in Indonesia, where market research and reliable data are hard to come by. Local media outlets are always looking for the most recent stats on Indonesia’s tech scene. If your company can provide an updated overview of the market or perhaps the most recent trends in a specific sector, Jakarta-based startup reporters are likely to gobble it up. Do make sure they cite your company as the source, however, provided that the data is accurate, useful, and originated straight from your own efforts.

2. Understand Kaskus

Newcomers may be perplexed by Kaskus at first. Questions naturally include, “Is it a forum?” “Is it an ecommerce site?” The simple answer is that it’s a lot of things, namely “Indonesia’s largest online community.” Kaskus consistently shows up as the top referer for most other successful portal in Indonesia, as is evident on public analytics tools Alexa and SimilarWeb. This means that Indonesian consumers often arrive at given sites after first visiting Kaskus. Tell your marketing and growth hacking team to ignore this site at great risk.

3. Embrace consumer-to-consumer

Currently, Indonesia is in the early stage of an ecommerce boom. Business-to-consumer ecommerce sites are arguably the future in the archipelago, but for now it’s the consumer-to-consumer marketplaces that reign supreme. Even if your business sells stuff online directly from your site, it’s wise to create accounts on marketplace portals like Tokopedia, BukaLapak, and others. This is a good way to get your brand noticed and and drive traffic to your site.

4. Localize your explainer videos

This is a must for any foreign startup looking to knock on Indonesia’s door. While a brief video that describes your company in English may be effective in other markets like Europe and Singapore, in Indonesia, you’re going to need one in Bahasa Indonesia. There are a few players in the market that can help you. Check out Wootag and Jelasin for video solutions.

5. Get wicked with user-generated content sites

Now that you have a clever video, it’s time to think about how best to deploy it as a marketing tool. Jakarta’s young population is internet savvy, and many local netizens share an affinity for potentially viral user-generated content like funny memes, video clips, and humorous comic strips. Sites like 1CAK and 4TAWA are great places for you to reach the consuming middle-class of Indonesia’s future. At this time last year, 1CAK – which is a hyperlocal version of 9Gag – reached 9 million monthly page views. Hint: For sites like this, make sure your content is a bit tongue-in-cheek so as to resonate with younger audiences.

6. Set up in a co-working space, or at least visit often

Jakarta has several co-working spaces that are great for new startups to get plugged into the local tech scene. These places can serve as your office, but also function as a sounding board for you to bounce ideas off other tech entrepreneurs who may be in a good position to tell you what works. For starters, pay a visit to the Ciputra GEPI Incubator, Comma, Kejora, and Conclave to see which location and community is right for you.

7. Indonesia loves giveaways

GrabTaxi seems to have internalized this piece of advice, as it’s currently getting aggressive in Jakarta with a Rp 20,000 (US$1.50) promo code discount. Locals have been making full use of it, and often short trips in the capital cost less than that amount (Tech in Asia writers have been using the app to travel just a few blocks for free this month – mmm living the high life). Jakarta’s “Uber for motorcycles” Go-Jek has also taken the giveaway strategy to heart, as the now popular app is offering Rp 50,000 (US$3.90) off of fares received with its own special promo code. The startups doesn’t lose much in these promotional deals, but because Indonesians love discounts, the companies gains massive brand awareness and pricelessly positive brand association.

8. Pitch just for the heck of it

Indonesia holds a lot of startup pitch competitions, where new companies speak and give presentations to groups of experts and investors. A couple ones to keep your eyes peeled for include Seedstars World, the Global Entrepreneurship Week Get in the Ring competition, Tech in Asia’s Startup Arena, and more. Regardless of whether you win or lose, pitching competitions are valuable because they generate a flurry of word-of-mouth marketing. They also serve as credibility builders, and a reference point for you to engage with the media. They’re also useful spots to find partners who can help increase your visibility further.

9. Celebrity endorsements

Some founders believe that getting a celebrity or public figure on board as an evangelist for your product is a great way to capture the hearts and minds of an Indonesian audience. Tech in Asia is inclined to agree, if you can pull it off with grace. It seems to have worked well for Jakarta’s online dating site Setipe, for example, a company that aligned itself early with Indonesian actor Christian Sugiono. Part of the strategic value Sugiono brought to the dating site in the early days was a large social media following. Recently, Setipe announced that it was getting increased traffic and was now responsible for several marriages in Indonesia.

10. Hold meetups and invite the influencers

If your business model relies on a community of followers or loyal customers, one of the most valuable things you can do is host events and invite all the important players. This will give your brand not just the needed awareness, but also credibility as an authority in Jakarta. One startup that does this particularly well is Tokopedia, as it regularly holds gatherings, workshops, and other fun events around town several times each month.

]]>https://www.techinasia.com/indonesia-10-ways-promote-startup/feed/0Social Media Week in Jakarta offers a chance to hear from Buzzfeed, Twitter, Path and the city governmenthttps://www.techinasia.com/social-media-week-jakarta-2015/
https://www.techinasia.com/social-media-week-jakarta-2015/#commentsTue, 24 Feb 2015 05:52:42 +0000https://www.techinasia.com/?p=220510Jakarta has just become the first Southeast Asian city to join the global Social Media Week (SMW) network. The conference with international and local speakers is taking place this week at Pacific Place Mall and other satellite venues in the Indonesian capital, and showcases the use and importance of social media for corporations, small and medium-sized businesses, media, and government.

Ever since Pesta Blogger and its successor OnOffID disappeared from Indonesia four years ago, there has never been a formal gathering of social media professionals of this size in Indonesia.

Yet Indonesia has gained global notoriety as a “social” country. The image is that of a hyper-communicative, vast, and young population, particularly quick to adopt new technologies. In 2012 research institution Semiocast published a widely-shared report that placed Jakarta on the top of a list of the world’s most active Twitter cities.

Recognizing a gap and need for a new and regular meeting place for social media professionals in Indonesia, Merah Cipta Media Group (MCM) reached out to the the Social Media Week initiators in New York and asked permission to execute the conference in Jakarta. MCM has a number of digital marketing and media companies under its wing, including local tech news outlet Daily Social.

Who’s gonna be there?

SMW Jakarta spans a full week of presentations and panels featuring established industry players, but the event also includes meetups and workshops in various locations around town. The event’s chairman Antonny Liem explains that he wishes to facilitate discussion and a deeper understanding of how technology affects lives in Indonesia.

Another noteworthy speaker is sure to be Buzzfeed’s VP of international, Scott Lamb. After recently setting up an Indian edition of Buzzfeed, his presence in Indonesia is already causing a stir. Buzzfeed knows it has traction in Indonesia, according to Liem, and participating in the conference is an excellent opportunity for the company to put out feelers in the local market.

Several other big names have recently set up shop in Indonesia. Twitter’s Indonesian head of business, Rick Mulia, is also featured in the conference lineup, and William Tunggaldjaja will have his first public appearance as Path’s country manager for Indonesia.

Social Media Week Jakarta is relevant for pretty much all Indonesia’s media and communications professionals, and it’s not to be missed. For startups, it’s less of an opportunity to pitch ideas or meet investors, but instead learn about trends and new ways to reach audiences.

Talent crunch, and talent shortage: these are two phrases that have dominatedtheheadlines of human resource-related articles in Singapore for years. It’s clear that a lack of skilful workers, exacerbated by the tightening of local immigration policies, is a problem here.

Technology might be the solution to that. Maheshswaran Suresh Kumar once ran two businesses and, like many other local startups, found it hard to acquire talent to bolster the ranks. One particular solution helped him tremendously during this time: outsourcing work to remote workers beyond the island-state’s shores. Tapping on the global “crowd” to find talent made sense to him, and Kumar identified a dire need for it not only in Singapore, but in most developed countries.

Launched in December 2014, talent marketplace Sourceguru was his answer, though admittedly not a unique one. Much like its more established counterparts Freelancer and Elance-oDesk, clients can publish their project requirements on the platform, and service providers – writers, designers, coders, and so on – will submit their proposals and bid for the right to work on them.

Solving a host of difficulties

Here’s where Kumar thinks Sourceguru can go one better than the incumbents. Firstly, it only allows for private bidding to be made, which Kumar believes will prevent counter-productive price wars from happening. Clients are also not required to reveal pricing and deadlines – these can be communicated privately with interested parties.

“Unlike most other sites, we do not run open bidding or contests – this allows for serious freelancers and companies to put up a proposal with pricing and deliverables in confidence to the buyer of the service only,” he explains.

High dispute rates because of either party flouting the terms and conditions are another huge pain that users of the existing platforms face. “When a dispute arises between buyer and seller, they expect you to resolve the issue, payment, refunds, and chargebacks,” Kumar says.

“When buyers and sellers can’t come to an agreement, they have to involve the platform as a mediator. In some instances there are even fees and charges for mediation. We find this unrealistic, as parties are sitting in different countries.”

To resolve this, Sourceguru abides strictly by what Kumar calls “real world business practices.” “When a buyer places a deposit for a service and there is no delivery, then a refund is made. For the service provider, if a buyer defaults even after receiving work, he is protected with the deposit – we then proceed to blacklist the buyer,” he explains.

A third commonly-faced problem lies in the payment process. Many of the current players find difficulty in transferring money to developing countries such as Pakistan and Bangladesh, which have a massive freelance workforce. In these cases, freelancers often have to jump through many hoops to receive the cash at their side of the world, and sometimes these solutions require additional fees to be made too.

Partnering with Red Dot Payments and Western Union Business Solutions allows Sourceguru to make transactions faster and cheaper than the rest, according to Kumar. “Having said that, we’re still in discussions with top international payment gateways on customizing a solution to this problem apart from the one that we’ve built,” he adds.

Looking to dominate Asia

Roughly two months after its launch, the talent marketplace now has about 12,000 users, the bulk of which are service providers – 1,500 of them are buyers. Of those, around 300 hirers and 3,000 service providers are active. “As for the rest of the user base, there’s about a 65 percent level of activity that we have been monitoring, mostly logging in, updating their portfolio/profile, and navigating the site,” says Kumar.

About 100 projects are currently ongoing or completed. While it is free to post projects and send proposals, Sourceguru takes an eight percent cut of the service provider’s earnings.

Kumar is now looking to quickly expand to other markets in Asia, as well as develop new features on the platform. “We’ve been active in India, Philippines, Indonesia, Singapore, and Australia. We hope to tap the Thai and Vietnamese markets as they’ve got great talents there,” he reveals.

Having raised S$2 million (US$1.6 million) in early 2014 from an angel investor, Kumar is now going for a bridging round, before raising series A funding in the second quarter of 2015. The goal: “to be the dominant Asian player in the talent crowdsourcing scene by connecting entrepreneurs, business owners, and talents with opportunities.”

Update (2 March, 1000am): A representative from Elance-oDesk disputes the points made above. He claims that, firstly, Elance-oDesk “does not run open bidding or contests for job posts;” secondly, it only provides “pro-bono mediation services in the rare instances when they are needed;” lastly, it has a global payment system that makes “payments much easier, not more difficult.” He adds:

We offer international withdrawal options for freelancers including PayPal, MasterCard prepaid debit cards, local funds transfer, and wire transfer. We are proud of our payments in Bangladesh where we launched local wire transfer in 2012, and since then people have been paid from oDesk to bank in two business days.

Jakarta-based travel and leisure activity auction startup Grivy announced today that it raised an undisclosed amount of pre-series A funding from several Indonesian family offices. While the identities of the investors were not made public, Grivy founder and CEO Jan Oudeman says that more than one of his new investors own large conglomerates in the archipelago. The startup will use the fresh capital to revamp its website and mobile app, as well as acquire more merchants, says Oudeman.

Grivy recently launched apps for Android, iOS, and Blackberry. The Android app was published at the end of last year. Oudeman says his goal for the next version is to focus more on simplicity and an easier-to-understand interface. He also plans to incorporate an Indonesian language option, which is key for any business that wants to target the local market.

Grivy claims to be Southeast Asia’s first site that lets users bid for leisure deals in Indonesia. The site is similar to Groupon and LivingSocial in the sense that it offers special deals. However, Grivy turns deal hunting into a bidding competition much like eBay. It recently closed a deal with Java Jazz Festival, one of Southeast Asia’s largest annual jazz events, a big win, according to Oudeman. In addition to concert tickets, Grivy also offers dining packages, hotel rooms, and beauty deals.

“Since our end users do not have a reference point with regards to other auction sites in the region, part of the new funds will be used to educate the market as well as to scale up operations,” says Oudeman. He adds that a strong professional network is an important aspect of doing business in Indonesia, and that he is pleased with Grivy’s new group of investors.

Grivy started as a one-man show in Jakarta last year and has grown to more than 20 employees. “Hiring and finding talent is a big challenge, but we managed to find bright individuals that are strongly committed,” explains Oudeman. “We are ambitious and are aiming to become the market leader in the region.”

]]>https://www.techinasia.com/indonesia-grivy-funding-news/feed/0Indonesia’s support for entrepreneurship is not up to scratch. Here’s how the government can get serioushttps://www.techinasia.com/indonesia-government-support-startups-entrepreneurship/
https://www.techinasia.com/indonesia-government-support-startups-entrepreneurship/#commentsThu, 19 Feb 2015 02:58:42 +0000https://www.techinasia.com/?p=220008

Everyone says Indonesia is the sleeping tech giant of Southeast Asia – the largest market, one which can’t be ignored. More than 95 percent of Indonesia’s businesses are startups or small and medium-sized companies. Nevertheless, startups are given very little support by the government, according to local tech business advisory firm Redwing Asia.

Last week, Indonesia’s tech minister, Rudiantara, claimed he would attempt to raise US$1 billion from locals conglomerates to invest in Indonesia’s IT startups. This is all something we hope will come true. But that amount of money is unprecedented in the local tech scene, and the government also has an ambitious infrastructure push on its plate this year, one which also needs a crazy amount of capital from the private sector. In the bigger-fish-to-fry sense, it’s certainly possible that tech startups will end up taking a back seat over the course of this year.

Regardless of whether Rudiantara is just wishfully thinking aloud, the minister’s statement poses some interesting questions for the Indonesian government. For example: in a nation with 50 million entrepreneurs, why doesn’t the administration do more to bolster the future of startups? Moreover, how can it set realistic goals and make good on its promises to local entrepreneurs? Essentially, how can it talk less and do more?

Jakarta should strive to become the mutated big brother of Singapore

Singapore’s economy ranks number one in the world for its ease of doing business, says the World Bank. A little more than a decade ago, this was not the case. At the turn of the millenium, the country’s Ministry of Trade and Industry decided that Singapore needed to transform itself into a nation of entrepreneurs, one that was unafraid to take risks. Fast forward to today. The current government has a slew of initiatives which provide support and resources – financial and other – to local startups. There are so many, in fact, that it’s hard to keep up with them all.

Granted, Singapore is small, with a population of only 5.4 million. Global conglomerates routinely use the nation as a parking spot while they size up larger market opportunities in the region. This makes Singapore much easier to cultivate, especially in terms of investor attention. For these reasons, experts can also argue that it’s tough to compare Jakarta to Singapore when talking about government support for tech startups – “apples to oranges” so to speak.

That may be true. But there are still many lessons that Indonesia can harvest from Singapore, and then morph so as to apply them in Jakarta. Easier access to capital is one. The SPRING Singapore initiative shows how that might be done. It offers a convenient microloan program to startups by working with financial institutions. Like Singapore in the early part of the decade, Indonesia could also ease up on its immigration policy, which would allow talented workers from overseas to join the fray and provide local startups with greater know-how. This would get global investors more jazzed about the archipelago as well.

What about Indonesia’s other neighbors?

Malaysia’s got a decent sized population of around 30 million, which is still nowhere near Indonesia’s 250 million, but substantially larger than Singapore’s. While the country doesn’t suffer the same infrastructural woes as Indonesia, it does seem to be getting its act together for startup support. One example of this is the Malaysian government’s recent initiative to create a network of big data analytics labs, a project that is supposed to nurture local startups and build national expertise in big data.

The Malaysian government is also actively inviting the Indonesian startup community to work together with their Malaysian counterparts through various schemes. However, I am not sure if the Malaysian government provides funding directly, especially for foreign startups coming to Malaysia.

Sandjaja adds that in the past, Indonesia’s ministries have tried to implement creative and worthwhile initiatives for startups, including HUB.ID, a platform where entrepreneurs and investors can find each other, but the efforts lost steam due to lack of support from ministries, business communities, NGOs, and others. According to him, the Indonesian government also appointed a director general for entrepreneurship at one point, but the budget was so small that coordinating a movement of significant scale would have been extremely challenging.

Fix regulations before burning cash

The Jokowi administration has appointed four ministries to coordinate all entrepreneurship related issues in Indonesia. However, no concrete actions have been taken so far to provide things like resources, network capital, or mentorship to Indonesian startups, according to Sandjaja. He adds that his organization remains a bit skeptical if the current administration takes entrepreneurship issues as seriously as it ought to.

In order for the government to play a substantial role in the maturation of Indonesia’s startup scene, many things will need to happen. Ideally, the government should focus first on improving regulations instead of fundraising (perhaps it could start with the controversial Negative Investments List). Local startups should be getting funded directly from the private sector, without government intervention, as a result of open and favorable market conditions. Indonesia’s four key ministries will need to spend more time in bed with academic, business, and social stakeholders to devise a more concrete plan, aside from Rudiantara’s scheme to throw US$1 billion at Indonesian tech startups at a point when they may not be ready for it.

These days, if you’re a die hard musician or even just an amateur songwriter, it’s likely that you have your own recording software. Popular titles include FL Studio (formerly Fruity Loops), Nuendo, Pro Tools, and Logic Pro X for Mac users. However, if you’ve heard of the Bandung-based audio tools startup Kuassa, odds are you’re not Indonesian, as most of its users come from overseas.

Kuassa specializes in digital guitar amplification and audio processing. The site, which has been around since 2010, is disruptive (as are its competitors) because it offers affordable computerized versions of otherwise expensive music gear for recording purposes. For example, users can purchase the Vermilion amp simulator for US$39 on Kuassa, whereas real-life amp combo prices can reach higher than US$1,000. On Kuassa, users can purchase and download a variety of virtual amplifiers, effects pedals, equalizers, and plugins that let music junkies mix and produce tracks that are comparable in quality to that of a professional recording studio.

The business model is not new, but it’s interesting to see how different startups go about it. Co-founders Grahadea Kusuf, Adhitya Wibisana, and Arie Ardiansyah are not just the software developers behind the Kuassa. They are also musicians themselves. Kusuf plays in an Indonesian electronic band Homogenic, while Ardiansyah writes songs and plays guitar in a local melodic punk outfit called Disconnected. Wibisana plays bass for the local industrial rock group HelmProyek. He is also one of the guys behind Indonesia’s most famous horror game DreadOut.

From blogging to selling beats

Before the inception of Kuassa, Ardiansyah had a blog where he posted musical freeware from time to time. This caught the attention of Kusuf, who was immediately keen to set up a recording studio in Bandung with Ardiansyah. In April 2010, the pair took notes on what holes really needed to be filled in the modern music market and then launched Kuassa. While the pair claims to have started Kuassa simply as a passion project, today Kusuf says that the site is their primary source of income.

“We know that Kuassa is popular throughout the indie music scene in London, for example,” says Kusuf, CEO. “We believe that we have good taste and abilities, and we’re now confident that we can make great products that music lovers will want.”

Most music software today lets you have a free trial to see if you like it. Most often the trials are limited by the number of days you can use it, or by the number of features available. Kuassa hopes to differentiate itself in this sense. “All of our trials and demos can be used forever,” says Kusuf. However, he admits that recordings in the Kuassa trial software are limited to 40 seconds, which is essentially just trading one restriction for another.

Big in the US and Europe

To date, Kuassa has sold more than 400,000 downloads, according to Kusuf. On average, its software prices range from US$39 to US$69. The team claims that the majority of Kuassa’s users actually come from the US and Europe. “The United States is by far the largest user base of Kuassa, and as much as 38 percent of our other users come from the UK, Germany, Australia, or Japan,” explains Kusuf. With a predominantly overseas clientele, Kusuf admits that marketing is tough for his team, as it is often difficult to get a direct line of contact to users and potential partners in other countries.

In addition to Kuassa’s headquarters being physically removed from its main markets, Kusuf recognizes that a shallow talent pool and local piracy remain troublesome for the startup. “The local market is not ready for this product because Indonesian people are not accustomed to buying software legally,” explains Kusuf.

Sizing up global music tech

Kuassa is going into its fifth year of operations in Bandung and has a total of eight team members. The startup is a completely bootstrapped operation, but Kusuf says Kuassa is currently looking for investors. As the team targets the global market, the growth potential for Kuassa is significant. According to the 2014 NAMM Global Report, an international authority on trends in the music industry, the recording and computer music market has declined slightly in recent years to around US$350 million in retail value, while plugin software and loops alone have reached more than US$20 million.

The team says Kuassa will also soon release mobile apps for iOS. “Apple already supports real-time processing,” explains Kusuf. “iOS is our main focus for now, and later we’ll look into Android and Windows Phone.”

Back in September, human resources software startup Talenta nabbed seed capital from East Ventures and Grace Tahir of Mayapada Group. Today, those investors get to see how founder Joshua Kevin has spent the money and time as Talenta launches to the public. (Disclosure: East Ventures also invests in Tech in Asia. See our ethics page.)

Kevin, 23, is nothing short of an active hustler in Indonesia’s tech startup scene, starting out as Tech in Asia’s first Indonesian blogger at the age of 19 before moving onto his own ventures in late 2013. His broad network has helped the young startup build up a strong client list that features several of Indonesia’s big tech players, including ecommerce stores Berrybenka and Bilna. Other paying Talenta customers include food finder Qraved and humor site MalesBanget.

Unlike its behemoth competitor SAP Software and Solutions, a product used by big corporations around the world, Talenta wants to just focus on startups and small-medium enterprises. The software tracks attendance, paid time off requests, overtime requests, and payroll. Talenta claims to help simplify salary issues, including tax reports, payroll slips, payroll files for banks, and other procedures that can bog down startups.

Talenta charges Rp 10,000 (US$0.80) per employee per month. There are free and premium options. Startups with fewer than 10 employees get to use the software at no charge.

The company currently has 15 employees, and Talenta is aiming to reach 300 paying companies by the end of the year.

Rudiantara, the minister of communications and information technology, claims the funds will be collected from the nation’s large conglomerates. His goal is not just to raise funds for local companies, but also to persuade local conglomerates who invest or save their money in foreign countries to think about investing in Indonesian companies instead.

“If the people who are capable of investing are just depositing their money in Singapore, they only get half a percent in growth per year, which is so small that it’s insignificant,” the minister told reporters. “More money needs to be put here in Indonesia.”

The minister hopes that after raising the funds, he can place the money in a private venture capital firm; one that is created in the shadow of the ICT Ministry, but is not actually controlled by the government.

(Update 2/17/15: One of our readers clarified a translation, pointing out that the VC would not be state-owned and could be privately owned so long as it passed through the government’s selection process.)

The minister said he hopes to raise all the funds some time within this year, and that he’s already received several “pledges” from major local players. While financial pledges and actual investments are two very different things, Rudiantara remains optimistic.

“I’ve just started, and I’ve already approached some conglomerates, but there will be more information to come on that later,” said the minister. Rudiantara made it clear that the funds raised would not just go toward Indonesia’s ecommerce startups, despite the sector’s vibrant growth in the archipelago.

Experts with skin in Indonesia’s ecommerce game will tell you to ignore mobile at your own risk, which is sound advice. Asian countries account for nearly half of all mobile online shopping, worth more than US$230 billion annually. With Indonesia’s mobile phone penetration rate beating home internet penetration by a factor of six, and all three of its major local telcos having recently launched their own 4G networks, the archipelago is poised to play an important role for any company hoping to enter Asia’s mobile commerce space.

Several local ecommerce sites have already launched mobile apps. The big boys that most people already know in Indonesia are of course Kaskus, Tokopedia, Lazada, Zalora, OLX, BukaLapak, and Elevenia. We often write about these guys. But truth be told, Indonesia also has a variety of awesome ecommerce players who are looking toward the future by focusing on mobile. In no particular order, here are ten ecommerce sites in Indonesia that let you shop on your phone.

1. Shoop

Tech in Asia has given honorable mention to Shoop on more than one occasion; and deservedly so. Essentially, Shoop is a mobile app that lets users sell their products on several local marketplaces – like Tokopedia, Bukalapak, and Elevenia – simultaneously. One of the app’s unique value propositions is that it saves time and money by providing a social element in which the shopper can follow their favorite merchants and receive alerts from that seller when deals or promos arise.

Shoop is one of the only straight-to-mobile eshopping tools in Indonesia, but Tech in Asia predicts there will be many more in the coming years.

2. Yes24

Yes24 is a books and office-related product etailer based in South Korea. It also sells items like cosmetics, consumer electronics, albums, movies, and gift cards. According to the site, the company has been active in Indonesia since April 2011, but its localized mobile app launched as recently as April 2014.

Yes24 also has apps for the Vietnamese and South Korean markets.

3. Bhinneka

No list of digital shopping in Indonesia would be complete without mentioning Bhinneka, the archipelago’s homegrown business-to-consumer ecommerce giant for computers and gadgets. More recently it added in toys, musical instruments, and appliances.

The company has been around in Indonesia since 1999, and competes directly with Lazada Indonesia. Bhinneka is on a mission to become the “Amazon of Indonesia.” But to do that, it knows it must have a strong mobile strategy, which is why it launched an Android app back in June 2012.

4. Qoo10 Indonesia

Qoo10 Indonesia is a joint-venture between eBay and the Korean marketplace Gmarket. It runs as both a business-to-consumer and consumer-to-consumer marketplace, and is active in six Asian markets, including Singapore, Indonesia, and Malaysia.

Qoo10 offers several ways for Indonesians to shop, including daily deals, group buying, auctions, and a special feature called Lucky Lounge, which is essentially a lottery to win special low prices. Users can purchase a variety of items in several categories including fashion, sports, digital, food, baby, and entertainment. Qoo10’s mobile app launched in Indonesia in late 2011.

5. Himax

Himax is a gadget, smartphone, and consumer electronics ecommerce company that came to Indonesia from Tokyo in late 2012. Himax manufactures its own budget smartphones that compete with Xiaomi and other affordable phone brands in the Indonesian market.

There are no other brands on its app or website despite wording that suggests otherwise in its Google Play description which reads, “The Himax app lets you shop top brands.” Weird.

6. Blibli

Indonesians who are savvy about online shopping are likely to know the name Blibli. The site is another one of the nation’s homegrown giants, and is owned by a subsidiary of Indonesia’s Djarum Group.

Blibli offers a wide range of products and directly competes with large local sites like Tokopedia, BukaLapak, and Lazada Indonesia. Blibli launched its mobile app not long after its 2011 inception.

7. CipikaStore

CipikaStore is a brand new site and app that was birthed by local telco Indosat late last year. The estore is localized for an Indonesian audience and sells snacks, gadgets, travel, and lifestyle products.

8. Lamido

Lamido is Rocket Internet’s consumer-to-consumer marketplace that operates under the Lazada Group. The site rolled out in Indonesia at the end of 2013.

The Lamido mobile app features an escrow system similar to those of Tokopedia and BukaLapak so that the shopper’s money is held by the company before being passed to the seller once the product has arrived. However, Lamido is the first consumer-to-consumer marketplace in Indonesia to offer cash-on-delivery and auction features. The app lets users browse products, instant message other users, and receive daily alerts about deals and promos.

9. Rakuten

Rakuten Belanja Online, the Indonesian version of Japan’s Rakuten ecommerce behemoth, has wisely moved forward with its own mobile apps for Android and iOS.

The app has just about everything under the sun including clothing, accessories, food and beverages, videos, music, home design products, and much more. Shoppers using the Rakuten app can also sort and filter search results by product ratings.

10. DinoMarket

Dinomarket prides itself on being a “worry-free” shopping experience. It’s one which has withstood the test of time in Indonesia. DinoMarket has been in Indonesia’s mobile space for ages already, as its first native app for Blackberry launched back in 2010, making it a bona fide dinosaur! Since then, it has also naturally come out with an Android app.

DinoMarket sells all kinds of items ranging from smartphones and tablets to fashion and automotive products. The app promises instant shopping and payment, followed by an option to check the status of your order in-app. Daily promos and discounts also come into play on DinoMarket’s app.

This list is by no means complete. If you know of an online retailer that deserves honorable mention for its mobile app and all-mobile shopping experience, feel free to include it in the comments section below. Tech in Asia would also really love to hear your thoughts on straight-to-mobile ecommerce in Indonesia.

]]>https://www.techinasia.com/indonesia-10-ecommerce-mobile-shopping-sites-2015/feed/0Here are the 11 startups currently inside Telkom Indonesia’s DDB Acceleratorhttps://www.techinasia.com/indonesia-telkom-ddb-accelerator-startups/
https://www.techinasia.com/indonesia-telkom-ddb-accelerator-startups/#commentsThu, 12 Feb 2015 05:15:58 +0000https://www.techinasia.com/?p=219209Indonesia’s telcos have been increasingly active in the tech startup scene recently. Earlier this week, Telkom Indonesia announced as part of its Indigo Apprentice Awards the first batch of local startups to enter its DDB Accelerator.

The accelerator is a relatively new initiative from Telkom, although it has taken three months since its inception to alert the public about this first cohort. In the past, Telkom has spearheaded a number of similar programs, including the Indigo Incubators in Yogyakarta and Bandung, which are also geared toward early stage startups. Some of the startups in this batch are coming straight from Indigo Incubator, while others were curated from the bootstrapping public and from within Telkom (Hint: Most of Telkom’s own startups in the batch begin with the letter “U”). In no particular order, here are the 11 companies that are currently in Telkom Indonesia’s DDB Accelerator.

1. Qbaca

Qbaca is an ereader app currently available on Google Play and iOS. This application is similar to Wayang Force or Scoop in Indonesia, as users can purchase ebooks directly, and payments can be made via carrier billing or with Tekom’s custom epayments solution T-Money.

2. Q-Journal

Q-Journal is a website that supplies Indonesia’s collegiate and academic journals to the public in digital form. The site offers two types of academic journals, the free ones – which are more basic and cover topics at a bachelor degree level – and the paid ones that contain information from higher levels of academia. Currently, Q-Journal claims to aggregate works from more than 200 colleges throughout the archipelago

3. Jarvis Store

Jarvis Store is a website that lets users easily create their own ecommerce stores, not unlike Shopify or Sirclo in Indonesia. With Jarvis Store, users do not need to know how to code in order to start building their own estores. This startup was also one of the original participants in Telkom’s Indigo Incubator back in 2013.

4. Ceritaperut

Ceritaperut (which translates to English as “Stomach Story”) is a site that allows users to share stories about their experiences at different diners or restaurants around town. With enough reviews, the site hopes to serve as a reference point for Indonesians before they eat out. Ceritapertu was also a part of the Indigo Incubator program two years ago.

5. U-Point

U-Point is an epayments system that uses carrier billing via Telkomsel and vouchers to let users shop online. U-Point provides several vouchers for online games, and Indigo disclosed to Tech in Asia that U-Point would become one of the accepted forms of payment on Google Play later this year.

6. U-Contest

U-Contest is a site that lets users create or enter a variety of online contests in Indonesia. This startups supports contests with various media like video, photos, and written content. Some national contests that have already used the service include North Sulawesi’s Nyong Miss Digital 2015 and the competition for the top Tourism Ambassador of Sidoarjo 2014.

7. U-Meet Me

U-Meet Me is a video streaming service for remote conferences. According to the startup, U-Meet Me offers advanced technology, which reduces the amount of bandwidth needed for live streaming. The local police department and Telkom University in Bandung have already used the tech for remote lectures and other situations.

8. U-Zone

U-Zone is an online media that reports on trending topics, travel, culinary, games, sports, and movies. Its target readers are Indonesia’s youth, and the content on the site is hyper-localized for an Indonesian audience.

9. E-PTSP

E-PTSP is a one-stop service for cloud computing. The service helps facilitate coordination between external agencies or internal departments. There are 25 types of business that the service can apply to including hospitals, pharmacies, and others.

10. Paperless Claim

Paperless Claim is a business-to-business service that helps facilitate the flow of insurance claims from hospitals straight to actual insurance companies. Paperless Claim is currently experimenting with two hospitals in Indonesia, Mayapada Tangerang and Premier Plastica.

11. U-Doctor

U-Doctor is a site that provides health-related information and consultations with doctors online. Participating doctors have the option to open a virtual clinic to accept more online consultations or use the site to schedule offline visits.

Alibaba announced today that AliExpress, the company’s global-facing ecommerce site, has localized for better service in Indonesia. While id.aliexpress.com has been active for some time (Tech in Asia spotted it back in October), today marks its official coming out party in the eyes of the company.

Indonesians who browse the localized version of AliExpress will see categories and product listings translated into Indonesian (though curiously, prices appear in US$) and curated for domestic tastes. Shoppers can complete purchases using Doku, an Indonesian payment gateway that processed US$520 million in transactions last year, or by making epayments at Alfa Group convenience stores (Alfamart, Alfamidi, and Alfa Express). Consumers can also call a help line where customer service representatives will respond to inquiries.

In order to bolster delivery, Alibaba says that China Smart Logistics, a logistics “consortium” it owns a 48 percent stake in, will partner with SingPost and its partner Indo Post to guarantee delivery within two weeks – halving the time Indonesians once had to wait for goods they bought on AliExpress. Last August, Alibaba invested US$250 million in SingPost – the reasons for which should now be more than apparent.

Alibaba adds that while the majority of the site’s product listings are sourced from China, in the future, it hopes to add more goods from Indonesian merchants into the mix.

Indonesia is expected to generate US$3.56 billion in business-to-consumer ecommerce sales this year, up from an expected US$2.6 billion in 2014, according to data from GoGlobe. That makes it the fourth largest ecommerce market in Asia for business-to-consumer sales. AliExpress’s competitor in Indonesia will likely be Tokopedia, a massively popular consumer-to-consumer listings site. Like Taobao, Alibaba’s flagship Chinese ecommerce site, Tokopedia monetizes through value-added services for merchants. The site recently raised US$100 million from Softbank and Sequioa Capital. Ironically, the former firm is one of Alibaba’s frequent collaborators in venture capital investments, dating back to the Yahoo days.

AliExpress has seen strong traction in emerging markets, particularly Brazil and Russia.

People aren’t used to getting things for free; much less when the thing they’re getting is a means to generate income. Most online shop builders in Indonesia offer free trial periods for users to test out the product, but local consumers and aspiring ecommerce players would be hard-pressed to find one that offers itself for free, forever. However, MobiFOR, a new online shop builder in Jakarta hailing from Lithuania, aims to be exactly that.

MobiFOR is a site that lets users create an online store quickly and easily without the need for programming skills, according to the startup’s co-founder Nerijus Abrutis. “The startup ecosystem is growing rapidly in Lithuania and MobiFOR has already received quite a lot of attention,” explains Abrutis. “After a great start in Lithuania, we adapted MobiFOR for the Indonesian market and are now trying to enter it.”

According to Abrutis, the main goal of his project is to encourage enterprising people to start their own business and give ecommerce a shot. According to him and his fellow co-founder Andrius Stepaitis, it has the advantage over local sites like Shopify, as it can offer its users a free, fully functional estore, and does not take any percentage of the user’s sales transactions. Abrutis says his site also offers free hosting, a mobile responsive design, search engine optimization, and no limit on the number of products that users can upload and sell.

Freedom isn’t free

Abrutis says that most potential users who are interested in the product inevitably ask the same question: What’s the catch? The answer is that MobiFOR’s free package is limited to 300 megabytes of storage and doesn’t offer multiple currency options, among others. On the other hand, its premium package, which costs €7 (US$8) per month, offers one gigabyte of storage, multiple currency options, PDF invoices, gift wrapping, and several other key services one would need to run a serious online shop.

“Users that choose a premium plan get more designs to choose from. They also get additional modules, such as newsletters, blogs, sliders, and even more useful ecommerce features,” says Abrutis.

US$8 is still significantly cheaper than Shopify’s thriftiest package, which starts at US$29 per month. However, Shopify’s plan comes with comparable options, including 24-hour support and a zero percent transaction fee. Abrutis acknowledges that MobiFOR must also compete with a variety of local competitors including Sirclo, Jejualan, Pixtem, and Lakubgt.

Abrutis says MobiFOR currently has 301 registered merchants, and 100 of them are active on MobiFOR at least once per week. He adds that 90 percent of MobiFOR’s active users are signing up for the premium plan, which he sees as a positive indicator of the company’s future growth. He did not mention whether the majority of the users reside in Lithuania or Indonesia, but he did say that he is optimistic about the local market.

“We have been watching ecommerce growth in Indonesia [and] that’s why we decided to expand here,” says Abrutis. “Looking at the statistics, the number of smartphone users in Indonesia has doubled between 2013 and now.”

MobiFOR is a completely bootstrapped, two-man operation, and Abrutis says he’s looking for investors and strategic partners here in Asia. He also hopes that in two to three years, MobiFOR can attract around 60,000 to 100,000 users, 70 percent of whom would ideally be premium plan subscribers.

Adtech. Tech in Asia loves it almost as much as puppy dogs or a fine scotch. The everyday consumer may not feel the same way, though, when their mobile game is interrupted by a pop-up for the new Beyonce album. According to a recent Gallup report shared with The Wall Street Journal, 62 percent of consumers say that social media has no impact on their purchasing decisions. “Consumers are highly adept at tuning out brand-related Facebook and Twitter content,” the survey says.

But that’s exactly the challenge that Carl Wong, founder of the mobile social networking video app Pitch6, hopes to solve. “Users should be watching ads not because they have to, but because they want to,” says Wong. “Crowdsourcing advertising wasn’t exactly new but no one had a crowdsourcing platform where anyone could create an ad. We developed Pitch6 to do this.”

Wong admits that his product is similar to the video social network Vine in the sense that users can create and share their own six-second clips. But according to him, what makes Pitch6 unique is that its users can make videos not just for their friends, but also for advertisers, and even get paid to do it.

Top dollar for Nikes, noodles, and nostalgia

In the app, advertisers can run competitions and dole out cash prizes for the six-second ads that generates the highest number of likes. Wong says users have fun creating short videos and get paid for it if they win. “Pitch6 is turning advertising on its head. It’s getting consumers to tell brands what they think ‘Just do It’ or ‘The Indomie Moment’ means to them,” explains Wong. “Because winners are chosen by the highest number of likes, consumers are encouraged to spread their ads through their social networks.”

According to Wong, anyone with a smartphone and a couple minutes can create a video ad on Pitch6. Friends will begin to watch each others’ ads not because they love the brands, explains Wong, but because they love the person who made it. However, after the video is shared, Wong hopes consumers will inevitably begin discussing the content, creating real engagement between the consumer and the brand.

Pitch6 is a Singapore-based startup with the Indonesian market in its crosshairs. The app launched in Jakarta last Friday in conjunction with an Indosat marketing campaign to promote the telco’s new gadget, lifestyle, travel, and snack ecommerce site Cipika. Wong says Indosat and Cipika are also running a competition on Pitch6 until the beginning of March, in which the first prize winner will receive Rp 50 million (US$4,000) for the best six-second ad.

Cards close to the chest

Wong did not share the details of Pitch6’s business model or monetization method. He also declined to share his company’s revenue projections for the next three to five years. “We’ll take a cue from Peter Thiel and say that if we did give them to you, it would be the one set of numbers that we know would be wrong,” says Wong. In terms of Indonesia’s market potential, digital ad spending this year will hit US$950 million, and by 2018 it’s expected to reach almost US$4 billion, according to Wong.

Pitch6 has three investors so far: Matthias Yao, Singapore’s former deputy speaker of parliament; Mohan Mulani, former owner of the now-publicly listed Harry’s Group (a chain of restaurants and bars in Singapore); and Tan Tee Meng, a private investor who deals mostly in real estate.

Pitch6 competes with global players like Poptent, Zooppa, Genius Rocket, and Tongal, but Wong says his app is the only one exclusively targeting Southeast Asia.

Vine could possibly be a competitor as well. “Vine could reformat itself quite easily to do what we’re doing and if they did do that, it would be highly flattering. And a good sign,” says Wong.

Video advertising is reshaping Southeast Asia’s media landscape with increased internet connectivity, a higher demand for choice and control, and an overall growing consumption of online video content, according to a recent Nielsen report. This is good news for Raj Sunder, founder and CEO of Wootag, a video engagement product that lets viewers make purchases and interact with brands inside the video they’re watching.

“Wootag is built for brands, businesses, startups, and even individuals. It is awesome as anyone can jump right in and start creating more interactive content,” explains Sunder. “It also shifts the function of videos away from users as mere spectators, and allows for a two-way interaction between viewers and content creators. Rather than just allowing viewers to comment on your video, viewers can potentially alter the viewing experience based on their interaction with the video.”

The implications for a product like Wootag in Southeast Asia are significant, especially when considering all the ways in which it could be applied to Indonesia’s flourishing ecommerce space. Sunder previously spent more than 14 years as a developer, serving Indian and Indonesian corporations like Tata, Virgin Mobile, and Bakrie Group. According to him, the product also helps with lead-generation, and can even calculate a user’s ROI for their marketing effort with Wootag.

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Sunder made a demo of Wootag for Tech in Asia using our Startup Asia promotional video from last year’s Singapore conference (a shameless plug that we will humbly accept!). Sunder made it so viewers can sign up for Bootstrap Alley, join our global platform for Asian startups and global investors Techlist, and even purchase discounted tickets to Startup Asia. Sunder also says he’s giving away a 15-day free Wootag trial to all Tech in Asia readers who use the promo code: TIA.

(Note: This is not an endorsement from Tech in Asia)

At certain points in the video, creators have the ability to insert a translucent dot that appears on-screen to indicate that the item it’s hovering over is important. The video will then offer up an icon at the bottom of the video to let users make some kind of decision. These calls-to-action can be anything from simply inputting an email address to actually buying an item they see in the video. Sunder highlights the utility this can present to the fashion industry, for example, viewers can now purchase the clothes “right off the model’s back,” so to speak.

Market potential for all-in-one audience engagement

In Asia Pacific the market for video advertising is around US$4 billion and Southeast Asia accounts for 10 to 15 percent of that, says Sunder. He adds that video spending in the region has also increased by around 23 percent year-over-year in less than a decade.

Sunder says Wootag launched in December and has so far received 1,700 unique visitors with a seven percent conversion rate for new signups. He didn’t give an exact figure on how many paying customers Wootag currently has, but he did say that 70 percent of subscribers have created at least one interactive video with the product. Wootag mainly competes with US companies like Innvoid and TubeMogul, which focus on video ad-serving. According to Sunder, it also sees competition in the form of a company called Redirections, which also provides tools for making interactive videos.

Wootag runs on a freemium business model, meaning it offers its service for free but with a cap on the number of engagements videos can receive. Paid plans start at US$25 per month and offer increased engagements and more features, including more sophisticated metrics and analytics. In terms of revenue, Sunder is optimistic. “With a conservative projection of about one percent of the total video market share, we believe Wootag is poised to hit the US$100 million mark within the next three to five years,” he says.

Wootag has not raised funds so far, apart from a combined investment from an anonymous angel at Google Singapore and an unnamed angel from the US. Sunder says that he has been focusing mainly on building a great product up until now. “When you have a product that can speak for itself, it’ll probably save a bit of time when it comes to fundraising,” says Sunder.

Fans of Asian indie horror games, rejoice! In an unexpected bit of great news, the second half of Indonesian indie developer Digital Happiness’s game DreadOut is coming to Steam this Valentine’s Day. You can check out the launch trailer for the second act of the game below, but be warned: it’ll scare you!

The first act of DreadOut was one of our favorite Asian games of 2014, and in my review of the game my only real concern was that it didn’t contain enough content to justify the price. But for those who already own the first act, this second act will be free, and it looks like it will contain quite a bit of new content.

Included in that new content: some horrifying new monsters. One of the coolest things about the original DreadOut was that its ghosts were ripped straight from Southeast Asian culture, and that tradition appears to be continued in the next act. The trailer reveals, among other things, what looks like an epic boss battle with a Pocong. Awesome.

Indonesian fashion ecommerce and brand partner Vela Asia announced today that it closed a series A funding round of US$1.5 million led by Singapore-based venture capital firm Majuven. Vela Asia will use the funds to drive growth across its partners’ websites and expand its technology offerings. Brands working with Vela Asia currently have access to real-time information about website performance, but the co-founders say this is also something they want to improve.

Vela Asia is a two-year-old company in Jakarta, and claims to have captured an appealing section of Indonesia’s online fashion market. Vela represents international fashion brands such as Lee Cooper and Havaianas by building and operating their ecommerce stores in Indonesia. The startup says it is currently the exclusive online partner for more than ten fashion brands, and there will be more coming soon. “Brands have responded extremely positively to our model,” says co-founder Susie Sugden. “They can see how quickly the segment is growing and they want to take advantage of that growth.”

Majuven is run by several prominent business figures including SingPost chairman Ho Kee Lim and former SingTel CEO Lee Hsien Yang. The investment in Vela is part of a wider push by Majuven to expand its holdings in ecommerce. The VC firm adds that it is currently working on a number of other regional deals.

“We have been extremely impressed by the traction Vela has generated in such a short space of time,” says Tek Yew Chia, executive director of Majuven. “What is clear is that Vela is well-positioned to be the leading player in premium online fashion in Indonesia, and we wanted to be involved.”

Sugden co-founded Vela Asia with fellow ex-Rocket Internet managing director Bede Moore. The pair originally came to Indonesia to work in retail for the Boston Consulting Group, according to Moore, but soon found themselves head-hunted by Rocket to co-found Zalora in Indonesia. The pair ultimately left Rocket Internet to pursue their own startup vision in the form of Vela Asia.

“We were very pleased to close this deal with Majuven ahead of a number of other suitors,” says Moore. “Majuven’s founding partners not only bring an unrivalled network and experience to the table, they also have a great track record for providing the support and mentorship young founders need.”

Vela was founded in 2012 to support brands and manufacturers sell their wares online in the growing Indonesian ecommerce market. It provides end-to-end support, from website to warehouse. The startup says it is also working on three new sites, which are all set to roll out over the next two months.

Surabaya-based media startup Studentpreneur announced today it received seed funding of an undisclosed amount from a group of local investors including Bambang Dwi Hartono, the former Mayor of Surabaya, Indonesia’s second largest city. This investment will be used to expand Studentpreneur’s community-building efforts in five other Indonesian cities including Jakarta, Bandung, Semarang, Yogyakarta, and Malang. Studentpreneur says it also aims to accelerate its vision of building a business ecosystem for Indonesia’s youth.

Dwi Hartono will join the board of directors at Studentpreneur. Endang Tjaturahwati, former Bank BPR commissary, will also join the board of directors as a financial advisor. The two new board members are seasoned veterans in East Java’s business domain, according to the startup, and the company expects them to increase public trust in the company.

Studentpreneur is arguably the biggest business magazine dedicated to young entrepreneurs in Indonesia with more than 10,000 readers. It is available in a print at several local bookstores. The digital edition can be found on ereader apps Wayang Force and Scoop.

The magazine was founded in March 2013 with their mission to create a mass media and business community for Indonesian youth. Studentpreneur claims to now receive around 1 million page views per month. According to the startup, it now has 9,000 members in its community database, most of whom are also from Surabaya.

Indonesia’s large family conglomerates seem to all be getting into new forms of entrepreneurship, and at the moment, it’s safe to say that the most unified and vibrant local sounding board is the tech startup scene. Sinar Mas launched its own VC firm Sinar Mas Digital Ventures (SMDV) as a separate entity, Lippo Group established Lippo Digital Ventures, which recently injected capital into local startup Gift Card Indonesia, and Bakrie Group backed the new VC firm Convergence Accel.

The Ciputra Group has long been one of the most active players in Indonesia’s entrepreneurship space. However, Junita Ciputra, managing director of the corporate dynasty and daughter of the company’s iconic founder Ir Ciputra, says that what her conglomerate offers fledgling founders is not money, but instead fundamental startup education, key network contacts, and an entrepreneurial view of the world. All of Ciputra Group’s entrepreneurship programs can be classified as corporate social responsibility (CSR), according to Ciputra.

“When my father started the entrepreneurship program, everyone thought it would be impossible. But from our initiatives, we now know it can be done,” explains Ciputra. “We grew up in a business-minded environment and we know this can be taught. But a lot of families are not as fortunate. […] For me, it motivates and touches me to see how people transform; students before and after our university program, migrant workers before and after our courses.”

A heavy hitter with fingers in several pies

Ciputra runs a number of initiatives aimed at building the startup community in Indonesia. The first and most obvious one is the famous Ciputra GEPI Incubator (CGI) located in DBS Bank Tower in Central Jakarta. GEPI is short for the Global Entrepreneurship Program Indonesia, and CGI offers facilities, services, and mentorship for early stage startups. It also serves as a co-working space and community hub for meetups and information sessions about entrepreneurship. CGI is a hotspot for Jakarta’s tech startups and is a routine stop-in for most foreign investors passing through town.

Along with its involvement in Endeavour Global, the University of Ciputra Entrepreneurship Center (UCEC) is another staple in the academic community. According to UCEC director Ivan Sandjaja, the University of Ciputra (which is the main school) has graduated 1,580 students in the past five years who have created 832 new companies, created 3,500 new jobs, and generated more than US$4.5 million in total revenue. Meanwhile in Jakarta, UCEC claims to have provided entrepreneurial training to more than 5,000 people annually. These people consist mainly of migrant workers, women in tough circumstances – such as the former sex workers of Surabaya’s notorious Dolly district – and Indonesia’s underprivileged youth.

Tech: It’s what’s for dinner

Ciputra says her company has a goal to educate four million local entrepreneurs by 2030. That number qualifies as a big fat audacious mission, even for one of the nation’s largest holding companies, considering that the current number is still only in the tens of thousands. According to her, however, the internet can be one way to help hit the ambitious four million mark. “It’s truly amazing what the tech industry is doing here,” says Ciputra. “I think because the traffic is so bad here that people naturally turn to the internet.”

Enter University of Ciputra Entrepreneurship Online (UCEO), the conglomerate’s free open online courses for aspiring founders. According to Ciputra, UCEO is a new initiative, but has already rounded up 35,000 users. It’s important to note that UCEO is essentially a series of videos followed by a set of self assessment quizzes. It does not issue its users any sort of recognized diploma other than a certificate of completion. Currently, it doesn’t serve as a comprehensive substitute for attending UC or UCEC, but according to Ciputra, it does create a starting point for those interested in becoming founders.

UCEO provides basic information on things like leadership, integrity, and how to build a business from several big players like Jakarta’s governor Basuki Tjahaja Purnama and Sen Senjaya, professor from the Faculty of Business and Economics at Monash University. The videos are free to the public after registering a name and email address. Users can also join the discussion forums to meet with other participants from all over Indonesia.

Ciputra says she has no intention to launch a venture capital fund for startups in Indonesia like the other big families have done, as it might pose a conflict of interest with the holding’s other startup initiatives – which are technically CSR activities. “But really, it’s more about the principle of it,” explains Ciputra. “I feel it’s a moral hazard to be an investor in startups but also try to help them grow.”

However, that doesn’t stop her from cheering on players like William Tanuwijaya or Nadiem Makarim. Ciputra claims admiration for sites like Tokopedia, Go-Jek, and Qraved, which she believes are helping solve the bottleneck problems of shopping, transport, and convenience in Jakarta.

HijUp, the self-proclaimed first and largest Indonesian Muslim fashion ecommerce site, announced today that it received seed funding of an undisclosed amount from a pool of global investors that includes 500 Startups, Fenox Venture Capital, and Skystar Capital. The company will use the funds to extend its lead in the Indonesian market before seeking an international expansion, according to HijUp.

HijUp claims to have gradually championed Indonesia’s Muslim fashion market since its 2011 inception. According to the startup, there is a worldwide upward trend of hijab-wearing, and as such, HijUp has attracted more than 100 local fashion designers to contribute to the site. Designers whose work is featured on HijUp include names such as Dian Pelangi, Ria Miranda, and Jenahara. HijUp says these individuals are internationally recognized in the Muslim fashion community.

“We managed to double our number of transactions every year since we bootstrapped in 2011 without any external funding. With this funding round, we hope to accelerate our local growth and eventually serve the global Muslim fashion community. Indonesia is one of the largest Muslim markets in the world and has the potential to become la capitale mondiale de la mode Muslim,” says Diajeng Lestari, founder and CEO of HijUp.

“HijUp has an exceptional opportunity of addressing the US$224 billion Muslim fashion market, while also promoting shar’ie or adherence to Islamic value,” says Eddy Lee, principal at Fenox Venture Capital. “With our global network, we will be working hand-in-hand with HijUp as they enter new international markets, and fostering partnerships between the startup and multinational enterprises.”

“We invest in HijUp because HijUp has a huge international potential. From the perspective of world market, no ecommerce players have focused on the Islamic market, yet at the same time the market is moving towards a niche offering. Our HijUp team understands this market and has the competence to execute à la haute couture in this field. We believe that HijUp can go international and big with this capital,” says Khailee Ng, managing partner at 500 Startups in Southeast Asia.

HijUp claims to have received 1.6 million unique visitors in 2014, about 20 percent of whom were from countries outside of Indonesia such as Malaysia, India, and the United States. In Indonesia, HijUp competes with similar sites like Saqina and Hijabenka.

However, as competition heats up, local crypto-currency players must now also go up against global Bitcoin wallet, exchange, and merchant service BitX, a Singapore-based firm that opened its doors in Jakarta earlier this week.

“We believe that the biggest opportunity for crypto-currencies are in emerging markets,” says BitX CEO Marcus Swanepoel. “These are markets where financial systems are often inefficient […] We believe that crypto-currency technology can have a huge social impact on these markets by making it easier and cheaper to move money.”

80 percent of Indonesia’s population is unbanked and the archipelago is notorious for its difficulties in the epayments realm. “The issue about banking the unbanked specifically is something that we think crypto technology can help solve in the long run, but currently it is not a viable way to bank the unbanked,” says Swanepoel.

BitX claims to have the edge over its competitors in terms of mobile strategy and execution. BitX is supposedly the only one that allows “know-your-customer” due diligence activity on behalf of local financial institutions. Swanepoel also says he looks forward to hopefully working with Indonesia’s local ecommerce firms, and that BitX will soon make cross-border remittance faster and cheaper for its users separated by distance in Southeast Asia.

(Update 2/5/14: This article has been updated to show that BitX is hopeful to work with Indonesia’s ecommerce firms in general. Marcus Swanepoel also wants to clarify that Indonesia has some great local Bitcoin startups, and he hopes to work with them as well.)

Indonesia’s second largest media company Emtek Group announced today it made a series B investment of an undisclosed amount in local online marketplace BukaLapak. BukaLapak founder Achmad Zaky says the fresh funds will be used to grow the startup’s staff and adopt new marketing strategies to spread brand awareness. Zaky also hopes to acquire more Indonesian SMEs as vendors on its marketplace. This could be interpreted as an early step for BukaLapak (a consumer-to-consumer marketplace) to make the move toward business-to-consumer sales.

Sutanto Hartono, CEO of Emtek, confirms that his company’s investment is limited to a minority stake in the company, and that all operational control will remain with Zaky and the current directors. Regarding Indonesia’s startup scene as a whole, Hartono says Emtek will focus on two specific items for now. The first is creating its own startup called Vidio, a site that lets Indonesians stream TV, movies, and entertainment for free. The second is to work closely with BukaLapak on synergy strategies. Tech in Asia is reaching out to learn more about Vidio.

Another objective of this investment is to provide a boost for Emtek’s as-seen-on-TV online shop O Shop. Hartono claims that O Shop will become a merchant on BukaLapak’s marketplace. He also says the Emtek’s role as a media company can help BukaLapak increase traffic to its site. He adds that the online marketplace business is a very strategic sector in Indonesia, one which Emtek looks forward to exploring further.

BukaLapak received its series A investment last February from price comparison site Aucfan, IREP, 500 Startups, and GREE Ventures. Zaky says BukaLapak facilitated more than Rp 1 trillion (US$80 million) in transactions during 2014 with the highest sales occuring in the gadgets, fashion, and hobbies verticals. BukaLapak’s merchants reached 163,000 sellers at the beginning of this year. Tech in Asia is also reaching out to Achmad Zaky for more in-depth coverage on this story.

Anyone well-versed in Jakarta’s startup scene can tell you that these days it’s all about tech. Almost every month in the capital, there are announcements of new joint ventures, foreign and local VCs funding some new software-as-a-service company, or a new incubator opening up under a larger tech firm. However, Adryan Hafizh, co-founder and CEO of the Kolaborasi incubator in Jakarta’s satellite city of Bandung, believes the demand for business incubators that embrace the “not-just-tech” mindset is high in Indonesia, and shouldn’t be ignored.

“The most surprising fact is that the non-digital startups in Indonesia are monetizing freaking good, far beyond most of the digital startups we know,” explains Hafizh. “For example, there’s one not-so-famous, 15-month old shoe brand from Bandung that submitted their proposal to us. When we checked the numbers, they generate US$30,000 in net profit monthly and they’re growing by 20 percent each month. Those kinds of opportunities are often overlooked by the digital-based incubators, but here, we’re ready to answer the demand and help the startup ecosystem grow.”

However, while Kolaborasi harbors some offline enterprises like BroCode – a gentleman’s barbershop in Bandung – it’s still safe to say that the incubator has its fingers in Indonesia’s tech pie. Several of the startups have strong online presences and a few even sell their products online. A couple of startups currently in residence at Kolaborasi include local fashion estore Quall and digital design agency Told Studio.

Invest in family

Kolaborasi has been running since May 2013, and has built 16 startups so far. According to Hafizh, three of them had shut down due to lack of market traction. On the other hand, he claims 10 of Kolaborasi’s startups have become profitable, meaning that their monthly revenue is higher than their expenses. Kolaborasi provides seed funding for the startups it incubates, and Hafizh says around US$1.9 million has already been distributed across the companies so far. He says:

Our business model has turned into a combination of an incubation center, a startup community, and a holding company, where we serve two markets, the startups – for whom we act as the incubator – and the investors, for whom we act as the investment portfolio management company.

Hafizh didn’t reveal who Kolaborasi’s investors are, but he did say that they are individuals with backgrounds in Indonesian business, politics, and the startup ecosystem in general. Kolaborasi specializes in the investment, fashion, culinary, and property sectors, according to Hafizh. He adds that Kolaborasi is a “family-based” incubator. This means that unlike other incubators, which often provide merely a workspace and a some bi-weekly mentoring sessions, Kolaborasi is more hands-on, and works side-by-side with the entrepreneurs each day.

Companies become cousins with cross-funding

Some of this hands-on work includes idea validation, customer acquisition activities, and business development guidance, says Hafizh. According to him, Kolaborasi is also unlike traditional startup investors who seek to monetize from high valuations and share sales. Instead, Kolaborasi seeks to retain its ownerships for the longer term and cash in on dividends periodically. It’s important to note that this is the opposite of what most tech investors do, as their typical behavior is to only collect money only when their portfolio company reaches an exit scenario, such as IPO or acquisition. Hafizh also says:

Unlike any other incubator or VC, we take mostly majority ownership in all of our startups, so we plan to earn our first revenue from our first dividend […] in the fourth or fifth years, in amounts of around US$14 million to US$15 million.

Hafizh claims that most of that profit will be reinvested back into Kolaborasi’s startups. He did not mention how much of those future funds would go back to him and the other community co-founders. As Kolaborasi has not yet reached its fourth year of operations, it obviously has not yet been able to collect dividends. However, Hafizh says that the startups in the incubator can still receive cash injections beyond the initial seed funding via “cross funding.” For example, if one startup in Kolaborasi is bringing in more revenue than the next, the first company will then help fund the second one. This is perhaps where startups must decide whether or not they truly want to be a part of the Kolaborasi family.

However, Hafizh claims it’s all in the spirit of Kolaborasi’s “family-based” approach, in which everyone in the incubator must rely on one another to move forward as a single team under one roof. “We uphold people development above the business development,” says Hafizh about Kolaborasi’s in-depth mentorship. “In our experience, most startups don’t die because of business problems, but more die from the problems caused by the founders and people.”

User-generated content seems to be a hot ticket in Southeast Asia’s media space. Several local players are coming out with localized products that are specially made for Indonesian audiences, in particular the tech-savvy millennial generation that understands how to use sites like BuzzFeed and 9Gag.

At a major media event in Jakarta this week, founder of KapanLagi Network Steve Christian said the new media contenders he fears most are in fact the tech startups working out of their garages. That’s a valid fear, especially when small startups like 1CAK and Hipwee are able to pull in millions of unique visitors each month.

But one startup in the new media space that you may not have heard of yet is Keepo. The site’s primary function is to help Indonesians find lesser-known media content, according to the company’s Surabaya-based founder and managing director Michael Rendy. “Keepo is a home for indie publishers,” says Rendy. “They are working together to bring in readers and provide non-mainstream content that is entertaining.”

Accidental advertising

After six years in the design business, Rendy stumbled into Keepo’s inception by accident. He was given the chance by the Private College Association of East Java to start a print publication targeted at schools in the area. He was not paid for the position, but he reserved the right to sell ad space in magazine. The return on his work was far beyond what he had imagined, as the demand for advertising in such a publication was high, and Rendy was able to pocket some cash. “Because of this, I realized how big the potential was of unique segmentation that is served by small media, like school magazines. I want to make this even bigger,” explains Rendy.

Essentially, the site lets users create customized media feeds across a variety of channels. Some channels are solely dedicated to topics related to humor and culture, while others feature creative artwork and unique narratives. One feed called Fordesigners features artistic T-shirt designs only, while another feed called Le Monsier offers content for men like cars, sports, and girls. Channels like the Hot News section include indie writers that are blogging on their own about important current events.

Keepo lets publishers follow channels and individual users, not unlike any other social network. But it also offers users a dashboard experience that lets them customize the types of content they wish to discover, while also keeping track of their own readership stats, replies, and notifications.

The startup aims to be an end-to-end publishing service. First, the site lets users create and manage their content. It offers monitoring and analytics so users can see how many people are reading their stuff, but it also helps users earn revenue from their content. “We want to make use of the unique segmentation owned by the publishers, and sell it to some brands that are related to [those segments],” explains Rendy. “We will sell it in terms of sponsorship advertisements and share the revenue with those publishers as well.”

Keepo itself monetizes in a few different ways. The first is the previously mentioned segment sponsorship, in which Keepo shares the profits with publishers. Rendy did not mention the percentage Keepo takes from segment sponsorships.

Sticky stories

Keepo’s second strategy for earning is simply through traditional ads on its site. The three kinds of ads include traditional banners, rich media banners, and Keepo’s version of viral advertorial which Rendy calls “sticky features.” Digital ad packages on Keepo start at Rp 12.5 million (US$989). The site also offers content marketing services in which Rendy’s team crafts articles and posts that have unique value for readers, but also mention the utility of a sponsor brand that hopes to reach the target readers. As content marketing is trickier and more of an artform that traditional online advertising, Keepo’s packages start at Rp 20 million (US$1,582).

Rendy says Keepo’s direct competitors in Indonesia are apps like Mindtalk, Pulsk, and Tumblr. According to him, Keepo also indirectly competes with Kaskus, MalesBanget, Nyunyu, and Hipwee.

Out of Keepo’s 350 available channels, 51 now feature publishers that produce at least eight pieces of content per week. Rendy says these publishers serve around 1.1 million unique readers each month. On average, Keepo received 2 million monthly visits and 6.8 million page views per month over the past three months. Currently, Keepo is a fully bootstrapped operation and is still in beta, but Rendy says he is open to meet interested investors. According to him, the company hopes to earn Rp 2 to 3 billion (US$158,000 – US$237,000) per month three years from now.

“We are now still focused on Indonesia’s market. There are 42 million online readers in Indonesia, and 59 percent of them are part of the young generation, aged 15 to 30 years old. That segment has become our target readers,” says Rendy.